Mobile financial services makes life easier for low income earners

Harun-or-Rashid came to Dhaka from Bhurungamari upazila of Kurigram in 1998 in search of livelihood. 

He took up pulling a rickshaw, saving as much money as he could to take back to his village once every two months or so. His family of seven depended on Harun's income. Sometimes, Harun would have to rush back home when an emergency payment had to be made, resulting in him earning less than he could have.

This is no longer the case as Harun can now easily send money through Mobile Financial Services (MFS), saving time, travel expense and facing no additional hassle. 

"Earlier, I used to send money through other people or personally take it. After I opened a BKash account in 2015, now I can send money weekly. And now my family don't have to eat leftovers as they can get money each week," he told The Business Standard.

Harun is also saving money on travel fare, meaning he can send more money than before.

Mokarram Hossain, also a rickshaw puller, lives in a rickshaw garage in the Madhubagh area of the capital. Talking about the benefits of MFS, he said, "I had around Tk7,000 stolen from this garage. After opening a BKash, I no longer carry more than Tk1,000 in cash. I keep all the money in BKash, cash out when I want and send money to my village as needed."

The MFS in operation has changed the lives of millions across the country.

According to Bangladesh Bank sources, mobile banking was launched in 2010. On March 31, 2011, the journey of mobile financial services began in the country through the mobile banking services of the private sector Dutch-Bangla Bank.

Initially this banking facility could be availed with the help of only two SIM operators – Banglalink and Citycell.

After this, BKash launched mobile banking services as a subsidiary of BRAC Bank. At present, the majority of the mobile banking market is occupied by BKash.

According to the report of the Bangladesh Bank, at the end of March this year, the number of customers registered in mobile banking was 10 crore 91 lakh 30 thousand 405 people. Among them, there are 5 crore 66 lakh 70 thousand customers in villages and 5 crore 24 lakh 60 thousand customers in cities. Some 6 crore 31 lakh 75 thousand male and 4 crore 56 lakh 26 thousand female customers are registered.

In the month of March, customers transacted Tk77,000 crore through mobile banking, with an average of Tk2,000 crore traded daily.

Mohammad Babar Hossain has been working as a local agent of MFS for seven years in Baratula village of Lalmai upazila of Cumilla. He said, now people can easily withdraw and send money through this method, while expatriate families can easily cash out without going to the bank.

Shipu Talukdar of a mobile banking shop in Kalyanpur Pora Basti area told TBS, "Most of the people in the slums send money from here to their villages.

Some keep the money with me for a few days and send the money to their families at home after 15 days or a month. However, in the current situation, the amount of money they send has decreased. Earlier where many used to send Tk5,000-8,000 per month, it is now Tk2,000-4,000."

Aminul Islam, a mobile banking shopkeeper in Mirpur Kazipara area, told TBS that most of the people who send money from his shop are day labourers, rickshaw drivers or domestic workers.

He deals with about 80 such customers per day.

Professor Saima Haque Bidisha of Dhaka University's Department of Economics told TBS, "As a result of this mobile financial service, the financial inclusion of many low-middle income earners in the country, who usually do not go through formal channels has been achieved. Its contribution to the country is huge. Currently, mobile banking employs many young people who were previously unemployed."

She said MFS had eased the daily life of low income earners and increased economic transactions, which had a direct impact on the economy of the country.

"However, it is possible to make this mobile financial service easier. Financial literacy should be increased among marginalised women and less educated customers, so that they do not give their PIN number to anyone else, and its charges should be further reduced. It is possible to make the process of sending more simple," she added.