Transaction growth through mobile financial service falls

DOT Desk: Growth in transaction through mobile financial services slowed down in 2018 despite significant growth in active MFS accounts, reports The New Age.
As per the latest central bank data, daily average transaction through mobile financial services grew by 7.17 per cent in November 2018 compared with the daily average transaction in January of the year, when growth rate was 16.7 per cent.
It shows that daily average transaction through MFS stood at Tk 1,050.91 crore in November 2018 against Tk 980.52 crore in January of the year.
In January 2017, growth in daily average transaction value through MFS was 50.52 per cent against the 47.7 per cent growth in January of the previous year.
Daily average transaction through MFS was Tk 840.2 crore in January 2017 against Tk 558 crore in January, 2016.
The figure was Tk 377.92 crore in January 2015. On the other hand, the growth in active MFS accounts was 71.74 per cent in January-November of 2018 against 25.5 per cent growth during the entire 2017. The number of active MFS accounts stood at 3.56 crore at the end of November this year against 2.07 crore active accounts in January this year.
High transaction cost along with lowering of transaction limit by the central bank to tackle digital hundi (an illegal form of remitting money in the country) are the major reasons behind the slowdown in transaction growth through MFS providers, officials of central bank said.
Strict measure to tackle irregularities was among other reasons behind the slowdown in transaction through the services, they said.
To tackle rising illegal use of MFS, from February 1, 2017, the central bank brought down the daily ceiling of mobile cash-in to Tk 15,000 from Tk 25,000 while slashing the maximum cash-out limit to Tk 10,000 from Tk 25,000.
The monthly maximum cash-in limit was slashed to Tk 100,000 from Tk 150,000, and the maximum monthly limit on cash-out was brought down to Tk 50,000 from Tk 150,000.
Besides, BB at the same time also asked MFS providers not to open more than one account against a national identification card.
In November, 2017, the BB again put a limit on retaining fund on the MFS account, fixing it at Tk 3 lakh.
At present, 18 MFS entities were providing the service out of the 19 entities which have obtained approval from the central bank.
BRAC Bank’s bKash and Dutch-Bangla Bank’s Rocket were holding 99 per cent market share.