The popular quote "a penny saved is worth two pennies earned" has a genuine mathematical significance but more importantly, it gives us profound inspiration for building up savings for futuristic empowerment. Six hundred years ago, noted British businessmen and academicians felt from personal experiences that an unspent penny could automatically turn into revenue. It was a very simple equation that if one saved a penny on a day, it would have an added one the next day. Perhaps, this understanding seeded the idea and practice of savings everywhere around whether for individuals or for cooperatives or businesses or even the governments.
It is well tested that savings play a domineering role in the dashboard of our life and living. Basically, considered as an assured measure for meeting emergencies or for materialising any futuristic idea and need, savings do render a psychological, social and economic relief. Saving is money not spent or the money that remains after meeting all necessities. Banks, which initially came into being to enable trade, commerce and collecting taxes, have thus thrived over the centuries to facilitate storing this extra or saved money. Today, banks rely heavily on savings and take adopt widespread programmes to woo individuals or organisations for making term deposits or subscribing to different savings schemes.
In our country, the trend of drawing savings has been in place for long. It is more so because there have not been extensive social welfare benefits. Those working with the public sector always had some relief as they would get pension benefits. However, those working in the private sector, particularly the less advantaged segment including farmers, general workers, etc., pass days with worries of making ends meet at old age. There are some schemes run by the government for the marginalised people but they can be cumbersome and may not have gained the expected traction.. Moreover, illiteracy and lack of accessibility to banking facilities forced a huge number of population out of any such savings scheme. Nevertheless, things began to see a ray of hope for these people as the mobile financial service (MFS) providers rolled out different savings schemes in collaboration with the scheduled banks. The entire charm of this savings opportunity lies in the fact that MFS providers have their reach at any place and any time. Banks have their limitations of infrastructure, manpower and operational schedules.
If we look back, over the last decade, MFS has attained a new importance in the banking landscape of the country. With over 178 million mobile accounts registered, there had been more than thirty per cent increase in transactions through MFS during the last fiscal year. With ever new programmes of convenience in monetary transactions, MFS is not only the fastest growing digital financial facility but also a well-trusted one.
MFS frontliner bKash has taken a lead in rolling out savings opportunities in recent years. Starting with the first such scheme in collaboration with IDLC last year, bKash has been partnering with several banks to spread wings for facilitating savings by as many people as possible, particularly for low savers and those lacking accessibility to schemes by the banks or that of the government channeled through the banks.
Latest on the card is launching of the Shariah-based deposit scheme by bKash and City Bank. Titled as City Islamic DPS, people can avail the service by using bKash app and account. With installment amount between Tk 500 and Tk 3000, one can subscribe to term deposits for different tenures. Another good part of this scheme is that a subscriber can use the app to check the account position, including profit. And all these can be done at ease, from anywhere and anytime. It is simply a push-button or touch-screen matter.
It can be well-gauged that such initiatives will help in financial inclusion and empowerment. It will particularly help the womenfolk and the marginalised people as a whole to save and ensure some comfort in future. Such a digital savings tool would also contribute to narrowing the gap between the well-off and less-advantaged segments in terms of trends and opportunities for savings.
Savings have merit not only for individuals but also for society. It contributes grossly to national development too. According to reports, in Bangladesh the savings rate is much lower than in the neighbouring countries. However, with the vigorously innovative endeavours like that of bKash, the scene is obviously destined for a positive change. Earlier, one may have had the desire to save but the scope and facility were not there. Enabling savings through technology democratises the access to such a basic financial need by transcending the need of any physical branch or the intimidation of making a small deposit at a physical branch. The money to be saved has to be spent. Perhaps, these interlocking endeavours by MFS providers and banking institutions will help in reshaping the financial sector of the country and contribute to its sustainable development.
Moinuddin Mohammed Rahgir is Chief Financial Officer (CFO), bKash. [email protected]
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