Thrust on EFT awareness

Speakers at a programme Tuesday underscored the need for popularising the Electronic Fund Transfer (EFT) channel by removing various existing hassles and creating greater awareness about it, making the industry more prepared to adopt RTGS.

RTGS (Real Time Gross Settlement) is the next level of electronic system, after EFT, to settle especially the high value fund transactions in a much faster manner. The Bangladesh Bank (BB) is set to launch it side by side the EFT next year.

They were speaking at a launching programme of "Nationwide Roadshow on Electronic Payment" organised by the Citibank N.A., Bangladesh at a city hotel.

Nazneen Sultana, deputy governor of the BB, as the chief guest, inaugurated the roadshow that will comprise of five additional workshops in Bogra, Jessore, Comilla, Mymensingh and Sylhet in different times of this year.

The opening ceremony was also addressed, among others, by KM Abdul Wadood, general manager of the BB's Payment Systems Department, Noel Saminathan, managing director and head, Citi's Cash Product Management in the Southeast Asian Region, and Rashed Maqsood, managing director and Citi country officer in Bangladesh.

Mohammad Akhter, head of cash management, Citi Bangladesh, Mohammad Akhlasuddin, deputy director of Payment Systems Department of BB, AKM Shirin, DMD of the Dutch-Bangla Bank and industry representative of the RTGS Evaluation Committee, Md Moinul Huq, head of treasury and trade services, Citi Bangladesh, Mahia Juned, head of operations of The City Bank Ltd, and Aron Mousum Samadder, manager, accounts, Metlife Alico, took part in a panel discussion while Mohammad Musabbir, implementation head, Citi Bangladesh, presented a paper on EFT usage in Bangladesh.

Objective of the roadshow is to reduce paper-based process from the entire payment industry and thus adding more efficiency in the economic system, officials said and underscored on having a strong electronic payment culture across the country as RTGS is expected to go live in the near future.

Some speakers said that EFT advanced much considering the overall industry scenario when it was launched because half of the banks didn't have core banking systems at that time; and EFT transactions also rose to 55,000 transactions per day from only 18.

But comparing the total volume of transactions (both electronic and paper-based), it (EFT) is still in much lower level than the expectation, they said.

As reasons behind that, they mainly blamed the lack popularity about EFT among both the customers and the bank officials, and various hassles that the clienteles are to face in taking the service.

One of the hassles is that "the EFT is still paper-based" in many banks because their customers are to physically go to the branches, fill up particular form and give signature to get EFT service.

"If all the branches do not go online and the transactions are processed truly electronically and automatically, full benefits of EFT will not be realised," Mr Shirin said.

He further said that since the EFT software has capability to settle the transactions several times a day, why the customers will wait for the next business day to get the fund credited?

Responding to this question, Mr Akhlasuddin said that software was initially installed in such a way. At that time, the number of transactions was very poor; now it rose to 55,000 per day.

Admitting the possibility to settle the transactions several times a day, he said, "To do so, total solutions need to be redesigned and we hope to come up with it."

He, however, underscored on need for creating more awareness about EFT to increase its transaction volume and to train the bank officials in the rural areas in this connection.

"Mindset of some bank officials, especially in rural branches, also needs to be changed" as they don't motivate the customers for EFT rather encourage for mobile banking; because, there is no fee for EFT while they can charge for the mobile banking, Mr Akhlasuddin added.

However, in a query from the participants, Mr Shirin later said the banks won’t be encouraged to provide EFT services more promptly, as the customers don't pay charge.

Stressing on having internet banking for all banks to render the EFT services in an electronic manner truly, Ms Mahia Juned said, "Otherwise, it (EFT service) does not make any sense."

Though there is no charge for EFT, some banks receives fee for it, some speakers said and termed it another hindrance to make the system popular among the customers.

Ms Nazneen Sultana said that due to lack of awareness, the customers were not getting full benefit of EFT, which is an easiest, efficient, secure and cost-effective system; the Citi roadshow would help make the EFT popular.

She urged all the banks to join the upcoming RTGS.

Mr Wadood said that RTGS would deal with the high value transactions and take only two-three minutes to settle each of the transactions while the EFT is normally concerned about retail transactions and takes a day for settlement.

He called upon all the banks to come forward to make the EFT system popular by various types of awareness programme like the Citi roadshow.

Citi is the pioneer in the BEFTN landscape since its inception, its officials said, adding that the bank currently process around Tk 2.7 billion of payment and receives Tk 2.4 billion in income fund in favour of its clients through ETF per month; its electronic to paper ratio is over 40 per cent in both payment and collections space.