img Vision of Digital Payment Ecosystem

Urmi loves shopping and takes every opportunity to avail discount from her banks and payment networks such as VISA and MasterCard. Discount offers are abundant now a day at retail shops, eateries to e-commerce sites. However, when it comes to pay the balance, it becomes a nightmare for the shoppers like Urmi. She draws her salary from her bank, for what she has to pay Tk 50 rickshaw fare. She has to visit all the banks’ branches to pay the balances of her cards. To do all her banking such as withdrawing salary, depositing to her pension plan, paying card balances she has to take half-day off twice or thrice a month and spend around Tk 300-400 as rickshaw fares in total. However, this could have been a different scenario if the banks rolled out full-fledged internet banking facility. Just imagine, Urmi is doing all her banking from her salary account online sitting at her home. With fully equipped internet banking, she could have transferred money to her savings account, clearing all card balances and pay utility bills without ever visiting physically to a bank branch. Huge amount of money, energy and time could have been saved. Except for MFS, issuing and using plastic or ATM cards are the main achievements so far in the electronic payment adoption at the retail level. According to the latest study, number of plastic cards stands around 92 lakhs with transaction at the country’s ATM reaching around Tk 84,000 crore. Statistics of the increasing transaction volume at ATM looks impressive, no doubt. However, plastic card and its ATM transactions are only part in realizing the vision of a digital payment ecosystem. On another front, massive amount of money is also being transacted through MFS brands such as bKash and Rocket but there is no interoperability. One cannot send money from bKash to Rocket and vice versa. It is also not possible to load money from bank account or card to MFS accounts and vice versa which is hard to accept. One must pay cash to the retailer to send, cash out or load money to her MFS account. These issues about cross-platform interoperability should be addressed ASAP. Though the central bank and the government are trying to realise the visions, the speed of progress is poignantly snail paced. Incentives as well as actions should be there from the authorities for accelerating the pace. For their part, banks, payment networks such as VISA and MasterCard as well as MFS brands like bKash are offering usage benefits such as discount, cash-back to increase transaction volumes at the retail level. All actors in the wider industry are also individually active in lobbying to make sure there is a business-friendly regulatory regime for their respective platform and there is nothing wrong with what they are doing. Problem lies with the fact; there is hardly any initiative or plan; joint or standalone for a comprehensive integration by the stakeholders. All stakeholder need to understand the importance of an integrated ecosystem rather only to focus on individual platform. They need to focus on a quick roll out of an integrated digital payment ecosystem, which will be beneficial for everyone in the industry.

Sabbir Ahmed Osmani

January 16, 2017

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