Nagad to fall in line finally
Nagad, a mobile financial service agency of the Bangladesh POSTOFFICE and a private entity, has received an interim licence from the Bangladesh Bank, within its push towards digital money amid the pandemic.
The central bank would perform inspections on the operator before awarding the final licence, a senior official of the BB's payment systems department told The Daily Star on Sunday.
The development employs the fledgling MFS provider put on the central bank in March for a full-fledged licence, prompted by a BB move that left it hamstrung.
On March 5, the BB asked banks to avoid the operation of trust-cum-settlement accounts maintained by organisations that are giving MFS and digital wallet services without its approval.
Subsequently, several banks suspended such accounts of Nagad, so that it is difficult for the business to perform its operations.
Before the temporary licencing was presented with, Nagad was the only MFS operator that had not been running as per BB rules.
It even didn't follow the "one national identification card per account" rule, and can attract a huge number of customers, industry persons say.
As part of its bid to achieve the full-fledged licence from the BB, Nagad will will have to cut the additional transaction limit it enjoys weighed against other MFS operators.
Currently, a user of Nagad can transact Tk 2.5 lakh each day beneath the Postal Act, whereas it is only Tk 30,000 for the other MFS providers.
Tanvir Ahmed Mishuk, managing director of Nagad, welcomed the BB move, saying the operator's existing offers would continue as the central bank hasn't imposed any restriction on them.
"When the Bangladesh Bank finalises the guideline and if any restriction is imposed, we will adhere to that," he told The Daily Star yesterday.
The interim licence didn't mention any conditions, said SS Bhadra, director-general of the postal department.
"If we are asked to cut the transaction ceiling, we can do that," he added.
However, a senior BB official contradicted both Mishuk and Bhadra, saying Nagad must follow the rules and regulations applicable for other MFS providers.
"If the operator doesn't follow the guidelines, it would face the music," he added.
Earlier, a good number of MFS providers requested the central bank to figure out the problem, as separate transaction limits were unfair for those who operate according to BB rules.
The BB also raised questions at various platforms, like the finance ministry about Nagad's service delivery process, as the Anti-Corruption Commission remarked that the company's accounts are being used for illegal transactions as a result of the bigger limit and lax compliance.
The problems were discussed at several meetings of the central bank, the ACC and the finance ministry.
However, Mishuk said the operator is closely dealing with the Bangladesh Financial Intelligence Unit (BFIU) of the BB and the BFIU hasn't received any complaints against Nagad.
The BB must take approval from its board before granting the full-fledged licence to Nagad as only bank-led model for MFS is currently followed in Bangladesh.
Nagad is a jv between the Bangladesh Post Office and Third Wave Technologies. The postal department owns a 51 % stake.
It rolled out commercial service on March 26 this past year although the operator has been around procedure since September 2018.
Riding on the huge transaction limit benefit, Nagad made a good start and has so far added 1.84 crore active accounts.
A couple of hundred crores of taka change hands each day through the digital platform nonetheless it is not reflected in the central bank's statistics.
