Bangladesh Bank will provide Tk 81.76 million loan to NCC Bank Limited for financing a Central Water Treatment Plant at Comilla EPZ.

NCC Bank signed a facility access agreement with Investment Promotion and Financing Facility (IPFF) Project Cell of Bangladesh Bank for availing IPFF fund under IDA Credit of World Bank on Thursday.

Dr. Atiur Rahman, Governor of Bangladesh Bank attended the signing ceremony as chief guest.

Mohammed Nurul Amin, Managing Director of NCC Bank and Md. Abul Quasem, Deputy Governor of Bangladesh Bank and Project Director of IPFF Project Cell signed the agreement on behalf of their respective organisations.

Bangladesh Bank has urged the Election Commission to allow banks to access into its NID (National Identity) server so they could increase mobile banking accounts or wallets and help deepen the financial inclusion.

“Unlike other countries, it is not common in Bangladeshi to carry NID, which is hampering adoption of wallet,” Governor Atiur Rahman told a function in Dhaka yesterday.

“There is, therefore, a need for awareness campaign of carrying NID and allowing access to NID by mobile bankers.”

He was addressing a function to release a survey report on “Mobile Financial Services (MFS): Consumer Insights” at a city hotel.

pi Strategy Consulting and Consultative Group to Assist the Poor (CGAP) of World Bank  jointly launched the survey findings at the function.

National Board of Revenue also uses the EC NID server in the process of registering the TINs.

According to the report, only 3% MFS customers transacted money using their own accounts, 52% through agents, 35% through either sender or receiver accounts and 10% through courier services.

The governor said it is natural that survey at agent points would be dominated by non-account holder customers. “Due to low transaction limit, some find it convenient to send money through agents.”

There is a general perception that opening an account is a cumbersome process-which indirectly promotes using agents.

The current form of registration, which doesn’t allow people to instantly open an account, significantly slows the process of financial inclusion – as people want to open accounts on the spot and transfer funds instantly.

However, self-wallet-use is increasing as many elements (i.e. airtime, loan repayment, merchant payment, school fee payment) are coming in the ecosystem and, time to time, one should study how the adaptation is increasing.

Atiur said most of the cash-ins are happening in major metro cities while cash-outs are spreading to the rural areas making significant contribution in terms of financial inclusion and there by inclusive growth.

“In cash-in markets, customers don’t feel the need to open an account, however, in the cash-out markets, there is a higher need to register and open an account.”

He said there are big differences in regulatory perspective -ours is bank-led model while others in the globe may not be so.

“It is a light-touch regulated. Normally central bank is heavy handed but I had to change mindset to understand that many are not educated.”

Pial Islam, managing partner of the consulting firm, presented the survey and said the research is expected to assist industry players as well as the regulator to gain important insights about MFS end-users.

According to the survey nearly 48% of the MFS users reside in urban areas while 32% in rural and 20% in semi urban areas. A big gender gap among the users, only 18% of them are female and the average monthly income of the MFS users is Tk8007, which is higher than the national average income, and nearly three times higher than the poverty line average income.

More than four-fifths of the users transfer funds between the members of same economic households. The study reports that those who are using mobile banking, tend to conduct more frequent transactions of lower monetary value compared to their own funds transfer patterns in the past.

A significant number of people have been opening wallets, especially over the last few months. Some 25% of those surveyed are wallet owners.

Among the MFS users, noticeable differences were observed in the study between wallet owners and those who don’t have wallets.

Early adopters of wallet are typically younger, better educated, earn more and have better English proficiency than non-wallet MFS users.

Islam said: “This raises some important questions about impact of MFS towards financial inclusion. Are the unbanked, less educated and poorer segments of our population being served through MFS in a significant way yet?”

By now, 28 banks have MFS permission and 19 are in active operation that includes BRAC Bank’s dedicated MFS, bKash. Key players in MFS are bKash, DBBL Mobile Money and M-Cash of IBBL with13.2mn registered customers with about 2 lakh agents nationwide generating (on average) more than 1.0 million transactions amounting more than Tk2.21b per day.

News:Dhaka Tribune/08-Feb-2014

Bangladesh Bank Governor Atiur Rahman yesterday asked banks and financial institutions to finance environment-friendly industrial infrastructure.
He said the Investment Promotion and Financing Facility (IPFF) Cell of the central bank, backed by the World Bank (WB), has been providing financial and technical assistances to infrastructural projects in the private sector.
The banks and financial institutions should play a major role in the proper disbursement of funds among entrepreneurs, he said. The governor spoke at a function marking the signing of an agreement to help Sigma Engineers with Tk 8.17 crore to build a central effluent treatment plant (CETP) at Comilla EPZ.
If CETPs are gradually set up at all the EPZs in the country, IPFF will also be able to finance them, he said.
IPFF has already completed first phase of its operation by disbursing 100 percent of its credit line to seven small power plants through different banks and financial institutions contributing 178MW of electricity to the national grid, according to the BB website.

News:The Daily Star/08-Feb-2014

Bangladesh bank (BB) has set the target for disbursement of Small and Medium Enterprises (SMEs) loan at Tk 887.53 billion for the year 2014. The amount is 19.63 per cent higher than the last year’s target of Tk 741.87 billion. According to sources, the scheduled banks and financial institutions disbursed a total of Tk 853.23 billion in last year (2013) among 0.744 million SME entrepreneurs across the country.  The SME loan disbursed in 2013 was also16 per cent higher than the target set for the year. Out of the total disbursements, women entrepreneurs received Tk 33.46 billion under the SME financing. Of the amount Tk 654.72 billion crore was distributed in urban area while Tk 198.50 billion in rural area. The authorities could achieve their target in disbursement of SME loans because of due policy supports from the central bank like rescheduling facilities and low interest rates, said SME Programme Department general manager Masum Patwary.
“BB always encourages commercial banks and the financial institutions to supply adequate loan to SME entrepreneurs to promote the Small and Medium  scale industries,” said the general manager. BB  is  planning to implement some effective initiatives for further expansion of SMEs across the country such as start up financing, credit guarantee scheme, venture capital financing, SME deposit product, cluster mapping, SME product marketing and web based marketing, non financial services and  incubation centre.
In Bangladesh, 90 per cent private sector enterprises are SMEs. Around 25 per cent of the country’s total labour force are working in the SME sector and contributes about 40per cent of gross manufacturing output, the general manager also added.
Banks in Bangladesh are being supported in SME financing initiatives at subsidised interest rate with refinance facilities from Bangladesh Bank, which is being funded by the central bank, government of Bangladesh and development partners like IDA, ADB and JICA.
The SME loan disbursement has increased in recent days as the central bank is continuously encouraging new entrepreneurs to take SME loans from banks and financial institutions, said M Mafuzur Rahman, executive director of the central bank.
“The development of SMEs can reduce economic disparity from society and help the country to create more employment opportunity. So we need to expand SME loan allocation across the country for the betterment of the economy,” also said the executive director.

News:Daily Sun/08-Feb-2014