Bangladesh Bank is going to revise the recently issued circular on Mobile Financial Service (MFS), to void the risk of illegal transactions. However, a final decision is yet to be made. The department of payment systems, of the central bank, is expected to issue a circular after finalising it.
According to a circular issued on August 2, a photo of an MFS user has to be stored, if he or she carries out a transaction (cash in or out) of Tk 5,000 or more. This will be changed in the revised circular.
Mahfuzur Rahman, executive director of Bangladesh Bank, told The Independent, yesterday, that instead of a photograph, an agent can choose to save a photocopy of the National ID Card of an MFS user, as per the revised circular.
“We had a discussion with banks and they told us about the difficulties in implementing the circular issued on August 2. We have also talked about how to resolve issues that they had raised in the meeting," he said.
An official of Bangladesh Bank told The Independent that an internal meeting has been held over this issue.
"We don't want to strangle the growth of MFS. Our goal is to provide banking facilities to all. So, we don't want to create barriers, rather, we want to make MFS transactions secure. Bangladesh Bank is determined to weed out illegal financial transactions," added the BB official.
The circular on mobile financial services, issued by the central bank on August 2, will be very tough to implement, said sources in different banks. But, they supported the idea of registration and re-registration of mobile SIM cards.
Abul Kashem Md Shirin, DMD of Dutch Bangla Bank, the second largest MFS provider in the country, told The Independent that there should be a law to check crimes, but it is very difficult to reduce irregularities only by taking users’ photos, or giving new directives.
It can be threat to a bank’s security system if the photograph of a MFS user has to be stored, while he or she is doing a transaction, an official of an MFS provider said.
"Dutch Bangla Bank has 120,000 agents and each agent has to be provided with a camera or a smart phone, if the circular is set to be implemented. Not only that, he should be given access to the banking system. With access being given to so many agents, the bank's system might become vulnerable," Shirin added. It is very tough to implement this type of a directive, he said.
"If this is implemented, the number of transactions will rise, but the amount will be lower than Tk 5,000. To control crime, law is more effective. The number of irregularities found in MFS transactions is very low. It's a bit illogical to change the entire system," the Dutch Bangla Bank DMD said.
"You may find that only 20 in every 1 lakh MFS transactions are illegal," he said. He pondered how reasonable it would be to control the entire system and suggested that a new law would be a good option, to identify and punish perpetrators.
Shirin welcomed the decision to change the requirement of saving photographs of high-value MFS users.
According to Bangladesh Bank, the total number of MFS agents was 538,170, before June. With this number, the monthly approximate transactions total about Tk. 13,000 crore. On the other hand, according to instructions mentioned in the circular, all subscribers will have to re-register their SIM-cards within six months, in accordance with Know-Your-Customer (KYC) norms. And, after completing registration or re-registration, a copy has to be saved.
Agents have to submit reports on all the measures taken in this regard, to the central bank, by August 31, and a report has to be submitted every six months, the circular issued on August 2 added. Talking about the BB directive, Bangladesh Telecommunication Regulatory Commission secretary Sarwar Alam said the process of SIM registration is going on now. "We've seen the directive issued by the central bank, on mobile financial services," he added.