'If we consider variable costs of operation (including USSD price), rate in Bangladesh is not rational, appropriate tariff modelling is necessary'
A competitive Mobile Financial Service (MFS) market and its liberalisation are necessary to reach its benefit to end users, according to experts.
They emphasised the need for MFS modernisation and liberalisation of regulation to make it a people-friendly transaction system.
The experts came up with their view at a seminar on “Future role of Mobile Financial Services in Bangladesh” held on Monday at Lakeshore hotel in the capital.
Dr Monzur Hossain, senior research fellow, BIDS, presented his keynote speech at the seminar.
In his speech, Monzur emphasised competitive Mobile Financial Service market and its liberalisation (bank-led MFS and MNO-led MFS) and focused on Unstructured Supplementary Service Data (USSD) pricing and costs of transaction and strategic alliance with MNO and financial outlets.
According to the latest statistics of Bangladesh Bank, Bangladesh has around 41.9 million registered mobile money accounts.
He said service charge in Bangladesh is about 2% at a flat rate (cash-out) while in African countries like Kenya, Tanzania and Zimbabwe this rate is applicable to different slabs. The higher the amount, the lower the service charge.
“If we consider variable costs of operation (including USSD price), rate in Bangladesh is not rational, appropriate tariff modelling is necessary.”
There is no restriction on MFS ownership in other countries excepting Bangladesh that requires bank-led MFS while other countries allow MNO to take the lead in MFS, Monzur added.
Lila Rashid, general manager (Payment system), Bangladesh Bank, said regulator cannot always do anything imposing regulations. MFS service providers should also have some responsibilities for the betterment of the sector, added the BB official.
In his address, bKash CEO Kamal Quadir claimed that MFS providers are charging the lowest rate in the world.
bKash charges are significantly low compared to others, he said, adding that customers should remember that bKash saves their time and also saves them from hassle.
Criticising the lower ceiling set for transaction, Fahim Mashroor, CEO of bdjobs.com, called for expansion of payment range.