Mobile banking of bkash in Bangladesh

1. 09/26/14 Premier University B.B.A Semester :6th Section “A” 22 Batch

2. Banking & Insurance Assignment on: Mobile banking of bkash in Bangladesh Submitted to Lecture: Ms.Tasmia Tahlil Department of Finance Faculty of Business Administration Premier University, Chittagong. Group: B

3. Presentater Name & Id : Name ID 1.Md. Ariful Islam Saimon Chy 1022114412 2.Md. Shahadat Hossain 1022114372 3.Rasheda Sharmin 1022114388 4.Md.Shazzad Hossain 1022114384 5.Imteaj Ibna Hossain 1021114362 6.Md. Rashed 1022114413 09/26/14

4. 09/26/14 Mobile Banking Mobile Banking also known as M-Banking or SMS Banking is a term used for performing balance check, account transactions, payments, credit applications and other banking transactions through a mobile device such as a mobile phone. bkash Limited, a subsidiary of BRAC Bank, provide mobile banking facility. Is a joint venture between BRAC Bank Limited, Bangladesh, and Money in Motion LLC, USA. The ultimate objective of bkash is to ensure access to a broader range of financial services for the people of Bangladesh.

5. Company Profile Targeted Device :Basic /Feature Phone Primary Delivery Technology : SMS/USSD Products & Services : Payments Markets Deployed In : Bangladesh Estimated Number of Users : 2.2 Million What is bkash? Year Launched : 2011 Business Model : Consumer B- Kash is the taster means to transfer money from one Place to another via mobile phone and a simple secure and (convenient place to store money. Besides b- kash can be used to make payments, pay bills, purchase items whether physical items whether physical or electronic . B- kash focuse lowest income people who are unknown to banking service those people may not have higher education and which people live in rural are in Bangladesh .b-kasha want provided banking services thus area are not coverage banking facilities for participating economical development by all level of people

6. Workings of bkash bkash maintains a huge network to provide its services. A simple form of the network is shown below for illustration.

7. Mission of bkash By providing financial services that are convenient, affordable and reliable, bKash aims to widen the net of financial inclusion. bKash wants to provide a solution for Mobile Financial Services, built on a highly scalable Mobile Money platform, allowing the people of Bangladesh to safely send and receive money via mobile devices By providing financial services that are convenient, affordable and reliable, bKash aims to widen the net of financial inclusion. bKash wants to provide a solution for Mobile Financial Services, built on a highly scalable Mobile Money platform, allowing the people of Bangladesh to safely send and receive money via mobile devices

8. ASsk About bkash :

9. . Objectives of the study : Main objective of our study is to identify the role of bkash in changing the life of people  Supporting objectives are:  Supporting objectives are:  To know the repayment of using b- kash mobile banking .  To know what are the services provided by b- kash & how it serve its customer To know what are the persons behind using bkash than other monetary service available instead of. To know what are the areas cover and or served by b- kash. To know the customer contentment in using B- kash. To know the framework of Bkash To find opportunities for bkash.  To know the repayment of using b- kash mobile banking .  To know what are the services provided by b- kash & how it serve its customer To know what are the persons behind using bkash than other monetary service available instead of. To know what are the areas cover and or served by b- kash. To know the customer contentment in using B- kash. To know the framework of Bkash To find opportunities for bkash.

10. The bkash served its services within the boundary of Bangladesh . Almost in every districts are served by b- kash though its huge network consists of agents retailers etc. There are many bkash centres are available in Bangladesh . A summary is given picture : Bogra Scope of the bkash

11. Mr.Shameran Abed Director Professor Dr. Jamilur Reza CAhoudhury Director Mr. Shib Narayan Kairy Director Nihad Kabir Director Mr. Iqbal Quadir Director Board of Directors Mr. Muhammad A.(Rumee)Ali Chairman

12. Services provided by bbkkaasshh

13. Benefits of bkash Fast Affordable 09/26/14 Nationwide Secure Convenient

14. Terms and Definitions Bkash Account – It's a virtual storage of money and can be accessed through mobile phone. After registration, one’s mobile number will be his/her bkash Account number. Registration – Opening a bkash Account on one’s mobile phone. bkash Mobile Menu – The menu one sees after dialing *247# Cash In – Depositing money into one’s bkash Account. Send Money – Transferring money from one bkash Account to another bkash Account. Cash Out – Withdrawing money from one’s bkash Account. One can Cash Out from any bkash Agent Point or from BRAC Bank ATM. Payment – When one pays from his/her bkash Account to a seller against product or service s/he purchases

15. Terms and Definitions My bkash – My bkash is an option on one’s bkash Mobile Menu from which one can check his/her account balance, see mini statement, activate ATM Cash Out service and change your PINs . bkash Mobile Menu PIN – This is a secret number like a password to secure one’s bkash Account. bkash ATM PIN – This is also a secret number to be used when one cashes out from ATM. Security Code – Security Code is a onetime PIN. When one cashes Out from ATM, one needs to generate a Security Code which can be used only once and remains valid for one hour. Transaction ID – A system generated unique reference number against each transaction that is preserved as identification. USSD Channel - Unstructured Supplementary Services Data Channel, a Gateway that routes USSD messages from the signaling network to a service application and back. USSD messages travel over GSM signaling channels and are used to query information and trigger services. Unlike similar services (SMS and MMS), which are store and forward based, USSD establishes a real time session between mobile handset and application handling the service.

16. HHooww t too o oppeenn a ann b bkkaasshh A Accccoouunntt To open a bkash Account: 01. Go to any of your nearby bkash Agent along with - a. Your mobile phone b. A copy of your Photo ID (National ID/Passport/Driving License) c. 2 copies of Passport size photographs 02. Fill out the Account Opening Form and put your thumb print and signature properly. Please make sure that you have taken your copy (customer copy) from Agent and preserve it for future reference. After opening an Account, you need to activate your bkash Mobile Menu. Follow the steps below to activate your mobile menu- 01. Go to bkash Mobile Menu by dialing *247# 02. Choose “Activate Mobile Menu” 03. Enter a new PIN for your bkash Account 04. Enter the PIN again to confirm Done! You will receive a confirmation message from bkash. Please keep your PIN secret all the times.

17. Other procedure Use following steps to pay now: You can make payments from your bkash Account to any “Merchant” who accepts “bkash Payment”. For example, if you want to pay after shopping: •Go to bkash Menu by dialing *247# ? Choose 'Payment' option by pressing '3' •Enter our business wallet number : 01768700284 •Enter BDT. amount you have to pay : xxxx •Enter a reference against your payment : xxxx •Enter the counter number : 1 •Now enter your PIN to confirm: xxxx •Done! You will get a confirmation SMS

18. Check Balance You can check your bkash Account balance anytime you want from the "Check Balance" option. To check your current Account balance - 01. Go to your bkash Mobile Menu by dialing *247# 02. Choose “My bkash” 03. Choose “Check Balance” 04. Enter your Mobile Menu PIN You will see the current and available balance of your bkash Account. Request Statement To see a Mini Statement with details of your latest transactions: 01. Go to your bkash Mobile Menu by dialing *247# 02. Choose “My bkash” 03. Choose “Request Statement” 04. Enter your Mobile Menu PIN

19. You will see the Change Mobile Menu PIN For ensuring the security of your bkash Account, it is recommended that you change your bkash Mobile Menu PIN when you feel that it may have been compromised. To change the PIN: 01. Go to your bkash Mobile Menu by dialing *247# 02. Go to “My bkash” 03. Choose “Change Mobile Menu PIN” 04. Enter your “Old PIN” 05. Enter a new PIN to replace the old one 06. Enter the new PIN again to confirm Activate ATM To avail the bkash ATM Cash Out service, you need to activate this feature from your bkash Mobile Menu. This is a onetime action. To activate the ATM Cash Out service: 01. Go to your “bkash Mobile Menu” by dialing *247# 02. Go to “My bkash” 03. Choose “Activate ATM” 04. Enter a new 5 digit PIN. This PIN will be your “bkash ATM Cash Out PIN” and is better to make it different from your “Mobile Menu PIN” 05. Enter the PIN again to confirm You will receive a confirmation message stating that you have successfully activated ATM Cash Out service. Change ATM PIN For ensuring the security of your bkash ATM Cash Out PIN, it is recommended that you change it when you feel that it may have been compromised. To change the PIN: 01. Go to your bkash Mobile Menu by dialing *247# 02. Go to “My bkash” 03. Choose “Change ATM PIN” 04. Enter your old PIN 05. Enter a new 5 digit PIN to replace the old one 06. Enter the new PIN again to confirm You will see a confirmation on your mobile that you have successfully changed your old PIN.

20. Cash In To deposit money into your bkash Account: 01. Go to any bkash Agent 02. Let the Agent know the amount you want to Cash In 03. Write down your bkash Account Number and the Cash In amount in the Agent Register 04. Pay the amount of money you want to Cash In 05. In exchange, the Agent will send balance to your bkash Account. Cash In done! You and the Agent will both get a confirmation message from bkash. Remember to sign the Agent Register before leaving the counter. From Agent cash out If you have sufficient balance in your bkash Account, you can withdraw cash anytime from any bkash Agent. To Cash Out from your bkash Account: 01. Go to any bkash Agent 02. Let the Agent know the amount you want to Cash Out 03. Write down your bkash Account Number and the amount in the Agent Register 04. Dial *247# on your mobile for the bkash Mobile Menu 05. Choose “Cash Out” 06. Choose “From Agent” 07. Enter Agent’s bkash Account Number (ask the Agent) 08. Enter the amount 09. Enter your bkash Mobile Menu PIN Done! You and the Agent will both receive a confirmation message. Count the amount the Agent gives you to make sure it is correct and sign the Agent Register before leaving the counter

21. Send Money Send Money allows you to transfer money from your bkash Account to another bkash Account. To send money: 01. Go to your bkash Mobile Menu by dialing *247# 02. Choose “Send Money” 03. Enter the bkash Account Number you want to send money to 04. Enter the amount you want to send 05. Enter a reference about the transaction. (Do not use more than one word, avoid space or special characters) 06. Now enter your bkash Mobile Menu PIN to confirm the transaction Done! You and the Receiver both will receive a confirmation message from bkash. Buy Airtime Buy Airtime allows you to recharge Mobile Airtime from your bkash Account. You can buy airtime for your own mobile phone or for someone else's mobile phone. Follow the steps below – 1. Go to your bkash Mobile Menu by dialing *247# 2. Choose “Buy Airtime” 3. Choose your operator 4. Choose your connection type 5. Enter the 11 digit mobile number you want to buy airtime for 6. Enter the amount of airtime you want to buy 7. Enter your bkash Mobile Menu PIN to confirm Done! You will receive a confirmation message from bkash. Currently, this service is available for any bkash Account holder to Buy Airtime for Robi Prepaid numbers and all Airtel numbers.

22. International Remittance bkash brings you the easiest and most convenient way of sending and receiving International Remittance. To send International Remittance from abroad to a bkash Account in Bangladesh: • Go to a participating Exchange House branch • Let the Agent know that you want to send money to Bangladesh through bkash • Fill out the bkash related fields correctly on the remittance request form available at the Exchange House • The Exchange House Agent will help you complete rest of the process While sending remittance through bkash, please ensure that: • Recipient’s number is a bkash Account number and belongs to one of the operators who is partnered with bkash (currently Robi, Grameenphone, Banglalink or Airtel i.e. 018, 017, 019 or 016). • The destination bkash Account number is entered as the 11 digit Bangladeshi mobile number starting with 018, 017, 019 or 016 e.g. 01XXXXXXXXX. The international dialing and country code should not be included i.e. there is no “+88”. • Recipient’s bkash Account number is correct. • The number has been written clearly & accurately in the correct field. • The BDT Value of sent remittance does not exceed bkash standard transaction limits. Countries and Exchange Houses from which you can send Remittance to Bangladesh: • UAE - Al Rostamani International Exchange (ARIE) - Al Ahalia Money Exchange Bureau - Orient Exchange • UK - BRAC Saajan Exchange Note: To find your nearest Exchange House branch, please click on the name of the respective participating Exchange House above. To receive International Remittance on your bkash Account: • To receive International Remittance through bkash, you first need to have a bkash Account. To open a bkash Account, go to your nearby bkash Agent along with 2 copies of your Passport size photographs, a copy of your Photo ID (National ID/Passport/Driving License) and your mobile phone (Robi/Grameenphone/Banglalink/Airtel). • Communicate your bkash Account number to the sender. The sender will use this number for terminating the remittance amount. • When the money reaches your bkash Account, you will receive a confirmation message on your mobile phone. • No charge is applicable to receive International Remittance on your bkash Account. You have to pay bkash standard Cash Out Charge only when you need to withdraw money from bkash Agent or BRAC Bank ATM.

23. Applicable Transaction Limits for sending/receiving International Remittance through bkash: Transaction Limits Transaction Type Maximum Number of Transactions Amount Per Transaction Maximum Amount Per Day Per Month Minimum (Tk) Maximum (Tk) Per Day (Tk) Per Month (Tk) Cash In 5 20 50 25,000 25,000 150,000 Send Money 20 70 10 10,000 10,000 25,000 Buy Airtime 50 1500 10 1,000 10,000 100,000 Payment No Limit No Limit 1 No Limit No Limit No Limit Cash Out from Agent 3 10 50 25,000 25,000 150,000 Cash Out from ATM 3 10 2,000 20,000 25,000 150,000 International Remittance 5 20 50 150,000 150,000 150,000 Tariff & Limits

24. Make payments at the following outlets using bkash.

25. Partners of bkash:  Robi  Grameenphone  Banglalink  Airtel  BRAC  Bill & Melinda Gates Foundation Fundamo, a Visa company 09/26/14

26. Research on bkash Users 09/26/14 A study on 150 people shows the following result According to Gender Gender Frequency Percentage (%) Male 90 60 Female 60 40 According to age Age of the respondents No. of Respondents Percentage [%] Below 25 years 30 20 25-30 years 50 33 30-35 years 40 27 35-40 years 15 10 40-50 years 9 6 Above 50 years 6 4 Total 150 100

27. Research on bkash Users 09/26/14 According to area Living area No. of Respondents No. of Respondents Remote village 25 16.6 Advanced village 27 18 Modern village 55 36.6 Urban 43 28.7 Total 150 100 According to Education Educational qualification No. of Respondents Percentage [%] Up to primary 23 15 Above primary to 42 28 secondary Above secondary to higher secondary 31 21 Higher secondary to graduation 44 29 Post graduation and above 11 7 Total 150 100

28. Research on bkash Users According to Occupational status Occupational Status No. of Respondents Percentage [%] Garments workers 60 40 Students 37 24.6 Government service holder 17 11.33 Private service holder 22 14.67 Business person 14 9.33 Total 150 100 According to personal opinion Agreeable level of opinion No. of Respondents Percentage [%] Strongly Agree 18 12 Agree 42 28 Neither Agree or Nor 33 22 Disagree Disagree 40 26.7 Strongly Disagree 17 11.3 Total 150 100

29. Findings Based on previous three years transaction we can show the growth benefits reasons for showing interest by more people for using bkash to faster receive or store money Years

30. bkash Vs. SMS Banking SMS Banking bKash Services are provided through SMS Services are provided through USSD menu Very few services (mainly information) are provided Wide range of services No Transaction can be made Transaction can be made Bank account is required Bank account is not required No agent involvement Agent involvement is present Services includes: Services includes: §Cash In § Instant Account Balance & Mini §Cash Out Statement §Send Money § Fixed Deposit Maturity Alarm §Payment § High Value Transaction Alert §International Remittance § Account status change alert §Check Balance § Welcome alert (for account opening) §Request Statement § Payment (loan) failure alert § Change Mobile Menu PIN § Cheque clearing failure alert § Activate ATM

31. Challenges: What are the internal and external challenges currently faced? One of the core challenges stems from the perception of technology maintained by low income users. For example, many users mistakenly think that they require advanced skill to use the technology. A similar issue arises in that users often think that advanced English is required to use bkash (although, in fact, very little English is required to use the service). bkash’s education program seeks to overcome these issues, “our menu is so easy to use that, once a user becomes familiar with the steps, she or he can opt for the required service by simply choosing a numerical input and not have to respond with any text reply”. (the same point was mentioned earlier: seems repeating) With a longstanding perception that “advanced and modern things” are not for them, low income users are led to believe that they are dependent on others for receiving a service. “Breaking this vicious cycle is one of the toughest parts of taking bkash to a level where physical cash would be obsolete.” Looking back, looking forward: What key lessons have been learnt, and what are the organisation’s future objectives? One important lesson is the difficulty experienced by low income users in activating features on their phones. However, as phones reaching financially constrained audiences become cheaper, internet-enabled, and have more intuitive features, bkash is optimistic that this area of difficulty will improve. “This would increase the ease of accessing services on mobile phones and hence increase mobile literacy.” bkash have also learned that human contact, one-to-one or one-to-many education and training sessions, are essential components in their educational efforts. “When our sales teams and agents interact with individuals and explain the service, users learn very quickly.” Looking forward, bkash aims to keep contributing to the nation’s socio-economic development. Fundamentally, this is facilitated by moving increasing numbers of people operating outside the formal banking facility into an expanding financial system. bkash also makes further use of this system: “All the little amounts can potentially add up to provide larger pools of capital to address larger problems. The organization is putting all the little idle bits of capital to use to move the country’s economy forward. Problem Statement Mobile banking is a totally new concept in Bangladesh. Although there are some banks that provide m-banking service but services are different than bkash limited. bkash has some agents in different location of the country but other bank’s has not agents. They only have ATM boot from where customer can withdraw money.

32. Competitors The main competitors of bkash limited are Name of Competitors Dutch Bangla bank ltd Mobi cash Islami bank ltd M-cash UCBL U-cash They are also providing some facilities of mobile banking for their customers. They are providing 09/26/14 different types of new offers to improve their business.

33. Problems and Solutions of bkash limited Now a day’s bkash limited has gotten a big popularity in Bangladesh. It is the easiest way to sending and receiving money from any corner of the country to another corner of the country. People can use it easily, so there are a few problem people are facing for using bkash limited. Problem No 1: No recovery system of Money: People may make mistake to send their money by using their mobile phone, but there is no recovery system to recover money from wrong number in bkash limited. Causes of problems: As bkash limited is a mobile based banking system, so there are so many causes for occurring this problem. a. Someone may input wrong amount of money for sending. b. Customer may press wrong button of his mobile phone. c. Customer may input wrong number for sending his/her money. Problem No 2: Higher service charge The service charge of bkash limited is higher than normal banking system. This problem is decreasing intention of using bkash service to the customers. Causes of higher service charge: Sender has to pay a charge for sending money; receiver has to pay some charges also for collecting money to bkash. On the other hand, receiver has to pay 5 tk commissions to the agents also. After adding all charges the service charge gets higher

34. Problems and Solutions of bkash limited Problem No 4: Not Available agent There are so many Mobile recharging shops in different location in Bangladesh. But everybody is not agents of bkash limited. So, the number of agent of bkash limited is very few in the rural area or village area of different district in Bangladesh. Causes of the Problem: Some retailers don’t want to take the risk of money for their clients. If the retailer makes the mistake for sending money, he has to repay the money to the client because of no recovery systems in bkash limited. On the other hand, agents get a small amount of commission from bkash limited. Problem No 5: Less External Security The external security of bkash limited is very lower than normal banking. In a normal bank, customer makes their transactions after entering an ATM booth or into the bank office. So, bkash service is more risky than other normal bank. Causes for the problem: Most of the shops of agent’s of bkash limited are in open places where people gather everyday. For example, the shops are situated in a market which is the risky zone for money. Thief may attack the customers after withdrawing money from bkash as the customers withdraw money in the public place and less external security.

35. Problems and Solutions of bkash limited Problem No. 5: Provided Poor service Causes of the problem Customer service center or touché point is not everywhere. Hot line service process is lengthy and costly. Request statement is not show all time. Air buy service is not available. Solution of the problem More customer touché points can improve customer service. Technological improvement can meet the committed services more efficiently. Problem No. 6:Agency’s Insufficient fund. Challenges of the problem Though bkash service is provided through agents so all the time they may not have available fund. Solution of the problem Appointing supervisor around the country to monitor fund availability can reduce this One of the core challenges stems from the perception of technology maintained by low income user problem. A similar issue arises in that users often think that advanced English is required to use bkash With a longstanding perception that “advanced and modern things” are not for them, low income users are led to believe that they are dependent on others for receiving a service. Opportunities It reaches almost every district in Bangladesh. People have a good image about bkash.