Tuesday, 31 May 2016
Tuesday, 24 February 2015
Dutch-Bangla Bank Mobile Banking - Banking for the unbanked
Dutch-Bangla Bank Mobile Banking
Banking for the unbanked
(Figures for the year - 2014)
Introduction:
Traditional
understanding of bankers has revolved around the presumption that banking
service (general banking) delivery is dependent on its physical presence- a
processing center, a bank branch and a cash counter. Today, this is not the
case. Following the DBBL’s journey towards unpaved road of Financial Inclusion,
many banks are now embracing mobile banking program in order to replace the
traditional bricks-and-mortar branches.
DBBL
the leader of technology driven innovative banking in Bangladesh had understood
that financial inclusion will not happen on its own. Therefore, the onus has
come on to the Banks to provide the same and it was Dutch-Bangla Bank who came
forward to bell the cat.
Dutch-Bangla
Bank is the first Bank in Bangladesh to start Mobile Banking on 31 March, 2011.
DBBL mobile Banking become very popular name all over the country in last few
years specially to the common peoples who value security and trust.
During
the year 2014 we have achieved a remarkable growth in agent expansion and
customer acquisition compare to previous years by re-engineering the delivery
channel and service modality. During this year DBBL has consolidated our Mobile
Banking Offices from Upazilla to District level, and increased number of Super
Agents and established the distribution facilities at Upazilla/Thana level to
ensure the better services.
Product & Price Review:
Dutch-Bangla
Bank is always very responsive to the customers’ expectation and market demand.
As a part of product innovation DBBL has brought numbers of facilities which are
very new in the MFS (Mobile Financial Services) industry.
To
facilitate all level of Customers DBBL has reduced cash-in and Cash-out service
charge from 1% to 0.9% which is the lowest in the market. Moreover, DBBL has
withdrawn the balance inquiry charges and reduced the P2P (Personal to Person
Fund Transfer) charges from Tk.10.00 to Tk.5.00.
To
bring the DBBL Mobile Banking services to the easy reach of the unbanked
segment, DBBL has also reduced the minimum deposit requirement for account
opening from BDT 100.00 to BDT 25.00.
To
address the untapped and unprivileged market, a total number of 751 employees, 77
MB Offices and 110,866 agent points are continuously working together to meet all
part of customer requirements. Moreover, 145 DBBL Branches, 4000 Merchants and 2700+
ATMs and partners banks’ branches are also working as mobile banking access
channel for the customers.
Mobile Banking Product &
Services:
DBBL
Mobile Banking has launched following Product & Services since inception to
to-date:
Customer registration:
New
customers can open a mobile account from any DBBL agent point, DBBL Fast Track, DBBL branch, BKB
branch, RAKUB branch, Union Information Service Centers, and from retail points
of any Mobile Operator. Customer needs to submit his/her photograph &
National ID (NID) to open an account. The minimum deposit required to open an
account is only Tk.25/- only. In the year 2014, more than 1.7 million new
customers have been registered for DBBL mobile banking.
Cash-in (Cash Deposit):
Customer
can cash-in (deposit) at any DBBL agent
point, DBBL Fast
Track, DBBL branch, BKB branch, RAKUB branch, Union Information Service
Centers, and at retail points of any Mobile Operator. The Cash-in fee at agent/retail
point is 0.9%, at branch is Tk.10/- and at Fast Track is free. In the year
2014, mobile banking customers have deposited a total of Taka 96 billion at
agent points and branches.
Cash-Out (Cash withdrawal):
Customer can cash-out (withdraw money) from any DBBL agent point, DBBL ATM, DBBL Fast Track, DBBL branch, BKB
branch, RAKUB branch, Union Information Service Centers, and from retail points
of any Mobile Operator. The Cash-in fee at agent/retail point is 0.9%, at
branch is Tk.10/- and at ATM and Fast Track is free. In the year 2014, mobile
banking customers have deposited a total of Taka 75 billion at agent points,
ATMs and branches.
Foreign Remittance:
Remitter can send
remittance from any nominated Exchange Houses of Dutch-Bangla Bank and other
Bangladeshi Banks located all over the world. The remitted money will be
transferred to the beneficiary's Mobile Account within 24-72 hours (in case of
DBBL Exchange House-24 hours) and the beneficiary will immediately receive an
SMS about the deposit.
Then the beneficiary can
go to any DBBL agent point, DBBL ATM, DBBL Fast Track, DBBL branch, BKB
branch, RAKUB branch, Union Information Service Centers, and from retail points
of any Mobile Operator and cash-out the required amount of money. There is no
fee for receiving the remittance in the account, but the Cash-out fee is
applicable for withdrawal of money.
The
DBBL mobile banking customers have received a total of Taka 325 million as
remittance from their respective remitters worldwide.
Salary/Allowance
Disbursement:
Dutch-Bangla Bank has devised a
low cost solution for salary disbursement. Under this solution, Corporate
Offices can disburse the salary of their employees, and Government can disburse
different allowances like elderly allowance, freedom fighter allowance etc. to
the people within a few moment in a hassle free way.
In the process, the Corporate
Office/Government sends a list of mobile account numbers and amount of monthly
salary/allowance to DBBL. DBBL credits all the individual accounts as per the
list by debiting corporate account centrally by a batch process system. The respective
employee/beneficiary gets an SMS regarding the salary disbursement.
Thereafter, the employee/beneficiary
can then go to any agent or DBBL ATM or DBBL Branch to withdraw money. There is no fee for
receiving the salary in the account, but the Cash-out fee is applicable for
withdrawal of money.
In the year 2014, Dutch-Bangla Bank has disbursed
salary and allowances of around Taka 6.00 billion to the employees of 173 government
and private organizations.
Air time Top-up:
DBBL mobile account holder can top-up/recharge
their own or other’s mobile debiting money from his/her Account. They don’t
need to go to a retailer for such services – they can recharge their or other’s
mobile from their home, office of vehicle. There is no fee for top-up/recharge
service.
In
the year 2014, DBBL mobile banking customers have made more than 40 million
airtime-topups (recharge transactions) for an amount of Taka 991 million.
Person to Person Fund
Transfer (P2P):
The money transfer from one mobile
account to another mobile account is called P2P transfer. Dutch-Bangla Bank’s
mobile banking customers can perform P2P transactions sitting at their home,
office or vehicle. The fee per transaction is Tk.5/- only.
In
the year 2014, DBBL mobile banking customers have made more than 1.5 million
P2P transactions for an amount of Taka 4.3 billion.
Bills Payment:
The
mobile banking customers can use the Bills Payment module of the mobile banking
and pay utility bills, tuition fee for various schools, colleges and universities
by debiting their respective mobile banking accounts.
In
the year 2014, DBBL mobile banking customers have paid utility bills for an
amount of Taka 358 million using the system.
Merchant Payment:
Merchant payment is one of the important mobile
banking products to boost financial inclusion. Using this product, the
customers can pay their bills against purchase of goods and services in the
shops. There are around 4,000 shops all over the country where mobile payment
is accepted. Apart from individual merchant, in the year of 2014, DBBL has acquired
some institutional merchants who have multiple branches like Swapno, Infinity,
Lubnan, the daily Prothom Alo, One to 99 Corner Ltd., and Nadia Furniture.
In
the year 2014, DBBL mobile banking customers have paid their shopping bills for
an amount of Taka 20.0 million.
ATM Withdrawal:
Dutch-Bangla
Bank has installed more than 2,700 ATMs all over the country which are
accessible to the cardholders of DBBL and other banks. DBBL has launched
cardless ATM transactions for its mobile banking customers. Thus the mobile
banking customers of DBBL can withdraw money from an ATM using his/her mobile
phone. This service has become very popular among the mobile banking customers.
There is no fee for ATM transaction.
In the year 2014, DBBL mobile banking customers have
withdrawn an amount of more than Taka 23.0 billion from the ATMs.
Balance and Statement Inquiry:
The
mobile banking customers can check their account balance and get a mini
statement in his/her mobile through sms. The balance inquiry is fee, but
customer needs to pay a fee of Tk.3/- for statement inquiry.
In the year 2014, DBBL mobile banking customers have
made a total of 30 millions of balance inquiry and 440 millions of statement
inquiry.
New services launched in 2014:
Linkage between Core Banking System (CBS) & Mobile
Banking System (MBS):
Dutch-Bangla
Bank has launched the linkage facility to connect mobile banking with the core
banking. After registration for this service, the mobile banking customers are
able to pull and push fund from his core banking account. This CBS & MBS
linkage facility is a unique feature of DBBL Mobile banking which gives freedom
of Banking to the customer at anywhere, anytime.
Most
of the mobile banking customers pull money from their savings account in core
banking and either recharge mobile phone or withdraw money from ATM without a
Card. This has eliminated the need of going to a retailer point for mobile
recharge or carrying a debit card.
Payment Collection:
DBBL
Mobile Banking has introduced Payment collection module to collect payment
automatically from target sub-base within a few moments in a hassle-free way.
By
using the payment collection module, customers can pay their Utility Bill,
Insurance Premium, Admission, Registration, Tuition, Semester, Convocation,
Subscription for Re-union, Training, Workshop or any other fee in a hassle free
manner. DBBL’s payment collection service reduces end consumer’s time,
increases convenience which allows paying fees on time to avoid extra change.
The
payment collection module has been used to collect payment & fee of IBA of Jahangirnagar
University, Naogaon Govt. College of Rajshahi, Department of Computer Science
& Engineering of Jahangirnagar University, Department of IIT of
Jahangirnagar University, Bangladesh Agricultural University in Mymensingh,
Sher-e-Bangla Agricultural University in Dhaka, Sylhet Agricultural University,
and Sylhet Engineering College.
Induction& expansion of service delivery channel -
Super Agent:
DBBL
started Mobile Banking operation in 2011 with the support of Telecom operators
and deployment of Agent all over the country. In the last quarter of year 2013,
DBBL has introduced Super Agents (Distributors) in between Bank & agent for
facilitating cash rebalancing of the agents.
In
some area DBBL had no branches. Agents of those areas needed to travel to
different area to Cash-In to or Cash-out from their account which would hamper
their regular business. In order to bring ease in process of Agent cash
management, DBBL launched Distribution model in Q4 of 2013 with 57 Super Agents
(Distributors) across the country. At the end of 2014 total number of Super
Agents all over the country became 211.
To
make the Distribution Channel more effective, DBBL has launched new commission
modality both for Agent & Super-Agent in July 2014.
Marketing activities in 2014:
Super Agent Meet:
In order to build a strong relationship among the
channel partners and as a part of continuous market monitoring,
DBBL initiated Super-Agent Meet in different regions to get the feedback of the
partners.
In 2014, DBBL has arranged Super Agent Meet in all regions
namely Barisal, Chittagong, Rajshahi, Rangpur, Comilla, Dhaka, Mymenshing,
Sylhet and Khulna. Senior Management teams from DBBL were present in all the
Super-Agent Meet to demonstrate the commitment of DBBL towards Mobile Banking
business.
Campaign with different Telco’s:
In the year of 2014, DBBL
mutually participated in different campaign carried out by the partner mobile
operators. These campaigns were launched for acquisition of new
customers, agents and top-up programs. All the programs were very successful.
Expansion of Telco Partnership:
DBBL started its Mobile Banking service with two MNOs namely Banglalink
& Citycell. Thereafter DBBL partnered with Airtel, Grameenphone and Robi in
last 3 years. In continuation to DBBL’s promises towards the valued customers, DBBL
signed agreement with Teletalk on 6 Nov, 2014. With this agreement DBBL Mobile
Banking became the first MFS having agreement with all the Mobile operators.
Expansion of Agent Partners:
Agent
network is one of the vital aspects for running mobile banking within an
emerging developing country like Bangladesh to facilitate financial inclusion
at grass root level. They are serving the end customer and acting as a first
contact point to deliver the service. At present Dutch-Bangla Bank Mobile
Banking has an extensive agent footprint in 64 districts through the
partnerships with different industry stakeholders including government and
private entities such as Local Government Division (LGD), Access to Information
(A2I), Mobile Network Operators (MNOs) and DBBL’s own Agents. This agent points
are increasing day by day to provide the banking services to the door step of
the people. During the year 2014, DBBL has achieved a remarkable growth in
agent expansion. At the end of year 2013, the total number of agent was 62,524
which has increased to 110,866 at the end of year 2014.
Expansion of mobile banking services to all the branches
of Bangladesh Krishi Bank (BKB):
In 2013 DBBL has entered into Agreement with
Bangladesh Krishi Bank (BKB) for mobile banking services. Under this agreement
BKB will open mobile accounts and the tellers of the BKB branches will provide
cash-in/out services to the mobile banking customers. The service was launched
in 3 branches BKB in 2013. In the year 2014, the service was rolled-out to all of
the 1027 branches of BKB.
Partnership with Rajshahi Krishi Unnayan Bank (RAKUB):
In the year 2014, Dutch-Bangla Bank entered into an Agreement
with Rajshahi Krishi Unnayan Bank (RAKUB) for mobile banking services and launched
the services in 132 branches of RAKUB out of its 376 branches. This arrangement
with RAKUB has allowed new customers to open DBBL Mobile account in the RAKUB
branches as well as cash-in (deposit) and cash-out (withdraw) money from any
BKB& RAKUB branches.
Development program for the Field Staffs:
Dutch-Bangla
Bank has arranged regular training and development program for the Field Staffs
in order to create a professional and skilled workforce. As a part of
maintaining compliance issues, DBBL has conducted audit and survey throughout
the year at all concern parts of the mobile Banking operation including agent
points. Moreover to create strong understanding about compliance and to be
aligned to the Bangladesh Bank guideline, DBBL has conducted several workshops
for our field staffs specially on Anti Money Laundering issue.
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Social awareness:
Dutch-Bangla
Bank has conducted a number of social awareness program at different locations
of Bangladesh. As part of awareness activities, DBBL attended the “Skill development,
Employment and Remittance Fair” held on 11th, 15th and 18th
September, 2014 in Tangail, Comilla and
Chittagong to promote the remittance product among the people, with the
collaboration of “Refuge and Migratory Movements Research Unit”, a renowned research
center under “The University of
Dhaka”. Besides, DBBL has participated at
the awareness program for the entrepreneurs of UNDP driven project “Urban
Partnership for Poverty Reduction Project (UPPRP)”.
Collaboration with a2i (Access to Information):
DBBL
has been working closely with Access to Information (a2i) Program of the honorable Prime Minister’s
Office. The Digital Centers established by a2i throughout the country are
working a partner of DBBL in providing mobile banking services in the rural
area.
With the help of a2i, DBBL is also disbursing
salary of the employees of UNO offices, collecting fees for e-porcha and collecting utility bills like water bill,
electricity bill, holding tax, dish charge through mobile banking.
In
the year 2014, DBBL became a co-branding partner of the “National Entrepreneurs’
Conference- 2014” which was attended by the entrepreneurs of various Digital
Centers’ of the country. The conference was inaugurated by the honorable Prime
minister.
Disbursing donation of NGOs
to Mohashen affected area:
In
the year 2014, Dutch-Bangla Bank worked closely with various NGOs to disburse their
fund among more than 30,000 Mohashen affected and water logged people of the
extremely remote areas of Borguna, Shatkhira, Kurigram, Sirajganj and Gaibandha
districts. DBBL field staffs of the respective localities trained the illiterate
and ultra poor beneficiaries on Mobile Banking operation.
Geographical Coverage:
In
the pilot phase starting on 31 March, 2011, the mobile banking services were
made available in 46 Upazilas of 6 districts in the Dhaka Division. Gradually,
the mobile banking services were extended to all part of the country.
To
look after the mobile banking operations, the whole country was divided into 77
parts, each part being under an office. These Offices are fully equipped with
computers, scanners, printers and other IT equipment.
Employment Generation for Rural
Bangladesh:
In
Bangladesh, the unemployment rate is very high. Thousands of educated people
are searching jobs after completing their graduation from different educational
institutions. DBBL operates its mobile banking business using local community.
As a result, a big employment opportunity has been created at different rural
area in Bangladesh. In the year of 2011, the total field staff was 418 and at
the end of year of 2014, the total field staff stands at751.
On
the other hand, DBBL engaged 110,866 number of agents for its Mobile Banking which
in turn has created employment opportunity for more than 110,000 educated
people.
Thursday, 11 September 2014
Mobile Banking – an affordable technology for digital banking
Written by
Abul Kashem Md Shirin
Published by
In the book entitled:
The Article:
On the other hand, the traditional banking is costly
for the customer. The customers need to pay enormous bank charges. The
customers also need to maintain a handsome amount of minimum balance in his bank account. Moreover,
most of the rural peoples are not educated and thus can’t write check and sign
on it.
It was therefore
a requirement that there is a banking system where the customers can transact
from their home in the rural area, pay less charges for banking, and can use
their mobile phone to pass the transaction typing a secret PIN (instead of
signing on a check). More than 100 million people out of a total of nearly 160
million people of the country use mobile phone.
In absence of an appropriate system to address all
the above issues, the rural people were always remained outside the banking
facility. Until 31 May, 2011, there were no means and ways to deliver banking
services to the rural poor people of the country.
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A Mobile Banking Agent
Point
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The Mobile Banking is a
revolution in Bangladesh. Now the number of people who knows the words “Mobile
Banking” is more than the number of the peoples who knows the words “Savings
Account”. Within next 2-3 years, there will be more Mobile Banking accounts in
Bangladesh than the traditional bank accounts.
As per the Central Bank of
Bangladesh, till March, 2014, the number of the registered mobile banking
customers is 15.0 million and the number of Agents offering mobile banking
services on behalf of Banks from their own shops in the rural area is 293,000,
which is more than the outlets of the existing traditional banking system in
Bangladesh. The value of mobile banking
transactions stood at Taka 79.00 billion (approx. USD 1.0 billion) in March,
2014 which constitutes:
a)
Cash-in (cash deposit)
b)
Cash-out (cash withdrawal)
c)
Cardless ATM withdrawal
d)
Disbursement of foreign
remittance/salary
e)
Air-time top-up (mobile recharge)
f)
Person-to-Person (P2P) fund
transfer
g)
Merchant Payment (payment after buying goods
from a shop)
h)
Utility bills payment (such as tuition fee,
insurance premium, electricity/gas/water bill)
i)
Collection (collection of
distributor’s payment by a principal company before delivery of goods to its
distributors).
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Disbursing government salary through
Mobile Banking
Union Parishad
(UP) is a local government body located in the rural area and constituted
by a few villages. There are elected Chairman and Members and appointed
secretary, Chowkidars and Dofadhars in each of the UP. The respective
district offices are responsible for disbursing their salary on bi-monthly
basis. On the date of salary the UP staffs need to spend one or two working
days travelling up to 100 km to collect their salary. A large part of their
salary was spent in travelling, accommodation and food during collection of
their salary from the district head quarter. There was involvement of risk
also while they were travelling with cash. The process makes the UP staffs
to spend their office time and hard-earned money, and also invites risks of
loss of their money.
DBBL’s
Mobile Banking has removed all these barriers for the UP staffs in Sylhet,
Sunamgonj and Jamalpur districts. The district authorities disburse the UP
staff salary through DBBL mobile banking every month and the UP staffs
withdraw their money from their nearest DBBL mobile banking agents. DBBL
has more than 80,000 agents all over the country. The UP staffs now get
monthly salary instead of bi-monthly, they don’t need to travel up to 100
Km, and spend lot of time and money. They can now utilize more time in
their office.
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There are millions of shops in
the rural area, sale proceeds of which are kept at shop or home. Thus a huge
amount of money remains ideal. Money at home or shop is not secured.
If all these people and their
money can be brought into mobile banking channel, there will be a huge
revolution in terms of financial inclusion and economic activity.
Mobile Banking in Bangladesh
is an affordable technology to achieve this goal. Any low cost basic mobile
phone can be used to access mobile banking system of a bank using USSD (Unstructured
Supplementary Service Data) connectivity of their respective mobile
operators.
In Bangladesh, only Bank-led model of mobile banking is allowed. Bank-led models allow
a prudent, regulated and mature approach to banking. While Bank-led models are
winning overwhelmingly in almost all countries, the non-bank led model exists
in few undeveloped countries.
Peoples of Bangladesh,
although less literate, are accepting the technology enormously. Government of
Bangladesh including the Central Bank and BTRC (Bangladesh Telecom Regulatory
Commission) is unanimously supporting the technology by formulating various
policies & regulations and promoting by arranging seminars, symposium and
talk shows on the subject matter.
Thursday, 17 July 2014
Banking the 87 Percent
According to market research conducted by Dutch-Bangla Bank Limited (DBBL) before it started its mobile banking initiative, just 13 percent of the 160 million people in
Bangladesh had bank accounts. The reason was a lack of branch offices in rural areas, where the majority of the population lives. Yet within the unbanked 87 percent,
which is more than 139 million people, 50 percent had mobile phones. Again, access was the key. Mobile operator agents
are widely distributed, the devices themselves are affordable and service coverage is constantly expanding.
Similar numbers are common in developing nations all over the world for the same reasons, which is why the opportunity for banks to bring basic financial services to the unbanked via the mobile channel is so big.
In mid-2011 DBBL launched a solution for customers to manage money with their mobile phones, depositing and withdrawing funds as well as conducting other financial
transactions. In addition to making banking more convenient and accessible for customers, the mobile channel provides a low-cost methodology for DBBL.
Why Mobile Makes Sense
Technology is a key business driver for DBBL, established in 1996 as a joint venture between local shareholders and Dutch company FMO. The bank focuses on financing high-growth manufacturing industries in Bangladesh. It has the largest ATM network and electronic processing system in the country, and it is the largest corporate donor. DBBL has won numerous international awards because of its unique approach as a socially conscious bank.
Combining its philanthropic mindset and willingness to put new technology to work, DBBL understood that deploying a mobile banking solution would be much less costly than expanding services through new branch locations or even ATMs.
Opening branches in the country’s rural areas is difficult and expensive. Each new branch requires the approval of the Central Bank of Bangladesh, which allows only 5 to 10 new branches per bank, per year.
New branches also require a staff of expert bankers, and generally, expert bankers do not want to work in rural areas. What’s more, rural branches do not take in enough deposits or provide enough loans to make them profitable.
ATMs seem like a better fit for rural areas—and there is no restriction on number—but they still require continuous maintenance, cash restocking from the nearest branch, rent,
electricity and security. Without a network of branches in rural areas, ATMs are not practical either.
For many years, these complications left the rural population cut off from the traditional banking system. That is changing now, however, as mobile phones are providing access and banking opportunities to people who have never had them.
Tapping into an Existing Network
Mobile phones are not the only access point. DBBL saw an opportunity to leverage a network that already exists throughout rural areas: mobile operator agents. These agents are generally small shop owners or retailers. As they are already distributed throughout the country, they help new customers open accounts and check account balances, as well as provide cash-in/cash-out services. Customers use their phones to authorize the transactions.
Account holders can arrange to have employers or the government deposit payments to their accounts, or mobile wallets, and transfer money to their relative’s wallets. The accounts remain secure by requiring personal identification number (PIN) access, and customers can change their PINs from their mobiles. The bank’s plans for the next phase of services include mobile airtime top-up, merchant payment, ATM withdrawal and micro financing—all using consumers’ mobile devices.
Benefits Beyond Banking
Existing and new customers have adopted mobile technology quickly, and a large segment of people that lived too far away from banks to open accounts can now conduct all types of banking transactions. However, DBBL’s mobile solution promises to deliver more than just banking. For people who have never had access to financial services, the numbers show that—as deposits are greater than withdrawals—simply having a bank account helps develop savings habits.
For illiterate people, who cannot sign their name to paper cheques, the mobile system provides a workaround whereby customers type their PIN into the phone. If the combination
of the PIN and the mobile number is correct, DBBL releases the money to the agent so he or she can pay the customer.
The system also allows local and international money remittance, so Bangladeshi expatriates can send money home. The receiving family member can withdraw funds at the nearest participating retailer or cash point.
An Open Network
DBBL’s service will be available on all mobile devices with subscription to any of the six mobile operators of Bangladesh. This openness is key to being able to reach the maximum number of customers, as the business model depends on serving the widest base of the economic pyramid.
DBBL now has a business channel that is much less costly to support than building branch offices and installing ATMs. This
tremendous innovation gives the bank a competitive advantage and ushers in a new era of banking in Bangladesh.
DBBL hopes that banks throughout the developing world will use its mobile banking initiative as a model. Mobile money can increase financial inclusion and bring positive change to economies throughout the world.
The writer: Abul Kashem Md. Shirin worked for the Bangladesh Sugar and Food Industries Corporation for 10 years and served as head of IT at BASIC Bank, Bangladesh for eight years and head of IT at DBBL for ve years. Since 2008 he has been the deputy managing director at DBBL.
Published in the Sybase Mobile Commerce Guide - 2012
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