Bank Asia to build largest network through post office banking

Bank Asia is set to build the largest banking network both locally and globally through the introduction of post office banking by engaging postal outlets across the country in providing financial services.

Under the new business concept, the private sector bank will provide financial services through postal outlets joining hands with the postal department of Bangladesh.

In the local networking part, the bank will provide financial services through 8,500 digital post offices across the country, appointing digital post office entrepreneurs under the post office banking agreement with the Bangladesh Post Office.

For global networking, the bank will connect with Eurogiro, a global payment community that is widely connected with post banks, postal organisations and payment service providers across the globe.

Bank Asia is going to be the first Bangladeshi bank to get connected with Eurogiro. Under the agreement with Eurogiro, the bank will engage all postal outlets with the global payment platform to provide remittance services.

Eurogiro has more than 500,000 branches in all regions around the globe and Bank Asia will connect postal outlets with this huge network through post office banking.

As a result, remittance senders will be able to access the vast network of Eurogiro to send money home through Bank Asia.

Bank Asia is now in the process of signing agreements with the Bangladesh Post Office and Eurogiro. The bank has already secured permission from the Bangladesh Bank to launch post office banking service.

As part of this mega expansion, the bank has issued a circular for manpower recruitment, said Md Arfan Ali, managing director of Bank Asia who envisaged the post office banking concept. He said this new banking model is the extended version of agent banking.

Agent banking is also the brainchild of Arfan Ali that has gained popularity in the banking sector.

Bank Asia has the second highest number of agents across the country.

The bank will take financial services to the doorsteps of people living in the remotest corners of the country by using the postal network, said Arfan.

He further said the postal department has trained up 8,500 entrepreneurs to run union digital centres for providing digital services to the rural people.

Bank Asia is going to sign a memorandum of understanding (MoU) with the postal department to use its digital service points, he said, adding that under the MoU, the bank will also go for individual business agreements with all entrepreneurs who will provide financial services on behalf of Bank Asia.

The bank will then connect the post office points with the global post office network through Eurogiro, as a result of which expatriate Bangladeshis will be able to send money home easily through the post office network from across the globe, he said.

Eurogiro's unique service for customers features a mobile app through which both remittance senders and recipients can get connected with the post office network directly. As a result, they will no longer need to get the confirmation about remittance sending or receiving through any third party.

Senders and receivers can also share information as well as transact money using the mobile app.

The app will make cross money transfer easier and cost-effective for remitters, said the Bank Asia boss.

Referring to the huge network of the postal department, Bangladesh Post Office Director General Md Siraz Uddin said the post office banking deal with Bank Asia will create a win-win situation for both entrepreneurs and the bank.

This is because post office banking will increase the earnings of entrepreneurs and the bank will expand its agent banking network using the digital postal centres, he explained.

Current status of Bank Asia agent banking

After launching the agent banking service in 2014, Bank Asia has established the largest agent banking network with over 4,400 outlets opened across the country till March this year.

The bank has the highest number of agent banking accounts – around 40 lakh – as of March this year. Bank Asia has a 50% share of the total 51 lakh agent banking accounts held by women in the country's banking sector, the central bank's data show.

The bank has mobilised deposits of Tk2,600 crore through agent banking and disbursed nearly Tk600 crore in loans as of March this year.

Bank Asia's financial inclusion will get another momentum for building a strategic relationship with Digital Post E-Centre and adopting the Micro Merchant Model.