MFS transactions off the charts

Money transferred through growing mobile financial services (MFS) in Bangladesh rose 40.50 per cent year-on-year to Tk 62,993 crore in June as people continue to rely on the digital platform amid the unabating coronavirus pandemic.

Transactions totalled Tk 44,830 crore in the same month last year, data from Bangladesh Bank showed.

Users, however, transacted 11.58 per cent lower funds in June compared to Tk 71,246 crore in May, the highest since Bangladesh allowed mobile banking a decade ago. 

The lockdowns, which put a curb on the movement of people and vehicles in the past four months, contributed to the growth in June, according to officials of several operators.

"As lockdowns affected the normal activities of the economy, the financial transactions through the MFS sector rose," said Shamsuddin Haider Dalim, head of corporate communication at bKash. 

He said the transaction was higher in May compared to June because of Eid-ul-Fitr. It slowed in the following months.

Person-to-person digital money transfer through MFS operators was Tk 18,827 crore in June, which was Tk 13,130 crore in the same month in 2020.

Payments made to merchants stood at Tk 3,293 crore, against Tk 812 crore in June last year, a year-on-year increase of 305 per cent.

In June, the government transferred Tk 1,225 crore among the beneficiaries of the social safety net programmes, up 242 per cent from Tk 358 crore a year ago.

Utility bill payments through the MFS system rose 25 per cent year-on-year to Tk 1,243 crore.

Zahedul Islam, head of corporate communications and external affairs at upay, the MFS service of United Commercial Bank, said the number of MFS users surged in the last one-and-a-half years due to the pandemic.

"The government has also disbursed various safety net funds through the MFS channels. Besides, the use of digital payments has grown significantly since the start of the pandemic."

The number of MFS accounts rose about 14 per cent to 10.12 crore in June in comparison to the same month last year. 

There were 11.31 lakh agents at the end of June, up from 9.98 lakh in the same month a year earlier, central bank data showed.

Amid the growing popularity of mobile financial services, "tap" made a foray into the country's MFS segment on July 28.

Trust Bank of Bangladesh has partnered with Axiata Digital Services of Malaysia to launch the Trust Axiata Pay, or "tap", under the joint venture Trust Axiata Digital Ltd.  This took the number of MFS operators in the country to 17.