After witnessing a declining trend over the last few months, transactions through mobile financial services (MFS) in the country finally started increasing in October.
According to the latest data from the Bangladesh Bank, an increase in government disbursements, cash-out and utility bill payments increased the volume of MFS transactions by 6.35% in October.
The volume of MFS transactions reached Tk93,013 crore in October, increasing by Tk5,567 crore from a month earlier, as per the regulator data.
The volume of MFS transactions stood at Tk87,635 crore in September.
On a year-on-year (YoY) basis, the amount of MFS transactions increased by 21% in October.
Industry insiders speculated that the rise in the volume of transactions was mostly induced due to the government's increasing reliance on MFS services in disbursing funds.
According to a top brass of Nagad, the MFS provider itself was responsible for disbursing around Tk1,000 crore of government funds during the month of October.
Central bank data also showed that during the period, government-to-person transfers increased by almost 70 times in just one month, standing at Tk1,418 crore in October.
Other than that, withdrawals by consumers in the form of cash-out from MFS also increased by 8% on a month-on-month basis from September, standing at Tk25,665 crore in October.
Meanwhile, payment by customers to merchants in the form of merchant payments increased by Tk236 crore month-on-month to Tk3,359 crore, while utility bill payments increased by Tk105 crore to Tk2,283 crore.
However, salary disbursements decreased by Tk93 crore to Tk2,659 crore month-on-month in October.
About 187.5 million users are registered with 13 MFS providers as of October, up by more than 2.3 million from September.
MFS transactions reached Tk94,293 crore in June when Eid-ul-Azha was celebrated and was at an all-time high of Tk107,460 crore in April, which was induced by the country's top shopping season of Eid-ul-Fitr.
Industry insiders mostly attributed the decline in July and August to the usual drop in transactions during the months following a big festival.
According to Tellimer, Bangladesh is one of the biggest markets for mobile money globally, with over 110 million users transacting $100 billion over the past year with more than 110 million individuals in Bangladesh currently using such services.
Of this 110 million, 45 million are active users, making it one of the most potent markets.
The latest industry data, when compared to 2015, showed that the number of registered mobile money agents had doubled over the period to 1.2 million, while the value of transactions increased six-fold, Tellimer reported.
Global researchers believe that the data signals a structural shift in the industry away from bilateral peer-to-peer transactions and toward a broader range of use cases, with banking penetration being low.
