Bangladesh Bank is set to introduce the electronic Know Your Customer (e-KYC) system under which bank accounts can be opened without filling in any paper-based documents.
Those with e-KYC will be allowed to operate limited-scale transaction through the agent banking network and mobile financial services, in a development that is set to boost the country's financial inclusion cause.
“The new system will help the unbanked and underprivileged people enjoy banking services,” said Md Anwarul Islam, assistant spokesperson of the BB.
The central bank will try to complete all process to introduce e-KYC, which has been in the works for the last two years, within June.
The customers will also be able to put in money in deposit pension schemes and the government savings certificates. The regular KYC required filling up forms along with photo and supporting documents.
For e-KYC, however, is a digital process where service provider can open a customer account by filling up a digital form, taking photograph on the spot, and authenticate the customer's identification data instantly. The thumb print would serve as the digital signature.
Banks are now allowed to verify the national identity card of their clients through using the NID data base, Islam said. The central bank has already framed a draft design to extend banking services through the e-KYC, another BB official said.
Customers with e-KYC can transact up to Tk 20,000 per month through the mobile financial service platform and Tk 1 lakh through agent banking. These are the reference scenario (imports through the current infrastructure); the Power Sector Master Plan (PSMP) 2016 (Bangladesh achieving 15 percent electricity import in its supply by 2040); and enhanced electricity import scenario of 30 percent in the total supply (Trade-30).
For 2012-45, the cumulated cost for power sector will stand at Tk 32.5 trillion for the reference scenario. This is Tk 35.7 trillion for the PSMP and Tk 27.6 trillion for the during the Trade-30 reference.
The trade-30 scenario needs less domestic power generation capacity and hence less investment not only in power generation capacity but also in fuel infrastructure development.
Enhanced electricity trade reduces fuel import for power generation, in particular that of gas, which has a more volatile market.
Bangladesh would be able to reduce carbon dioxide emissions significantly by adopting the enhanced import option, according to the report.
For India, export revenue earnings make Indian households gain in the form of increased consumption, which is higher when trade is higher.
The report said a 30 percent share of electricity may be within the limit of Bangladesh's way of ensuring energy security by restricting import dependence on a single fuel or source and diversifying the sources of power supply.
Trade with Bangladesh also gives India the opportunity to exploit its large hydro potential in the North-East, which could be evacuated through Bangladesh.
Bangladesh now imports 600 megawatts of electricity from India and more imports are on the cards.
Another 500MW will start to roll in from June this year, said Harsh V Shringla, high commissioner of India to Bangladesh.
He said Bangladesh was now importing 100MW of electricity from Tripura, but there was a huge scope to increase it significantly.
The high commissioner said among all the areas of bilateral cooperation, the power sector cooperation has seen faster growth. “We have seen some tangible cooperation,” he said.
Shringla said India was committed to partnering with Bangladesh's goal to ensure electricity for all by 2021.
He said India has agreed in principle to allow Nepal to use its land to pave the way for exporting electricity generated from hydropower to Bangladesh.
He said both Bangladesh and northeast India can benefit from the north-eastern region's huge hydropower reserves.
Farooq Sobhan, president of Bangladesh Enterprise Institute, praised the government's initiative that facilitated the import of power from India as an important step.
He said power trade with India, Bhutan, and Nepal could help Bangladesh achieve its ambitious targets set for 2021 and 2041.
In fact, regional cooperation in the power sector would help all participating countries, he said.
The former secretary said as Bangladesh was trying to diversify its energy sources, countries like India could be of enormous importance for Bangladesh.
“What is imperative is that this has to be structured on a win-win basis.”
Gowher Rizvi, international affairs adviser to the prime minister, said all countries in South Asia were suffering from an electricity shortage and power trade could help them overcome the shortfall.
In the concluding session, Nasrul Hamid, state minister for power, said Bangladesh would require $40 billion by 2020 to develop its power sector.
Kirit Parikh, chairman of the IRADe, Kerry Reeves, deputy director for environment and economic growth at the USAID Bangladesh, and VK Kharbanda, project director of the SARI, spoke in the inaugural session.
Mustafizur Rahman, a distinguished fellow of the Centre for Policy Dialogue, Mohammad Hossain, director general of the power cell, and Mamun Rashid, managing partner of PwC Bangladesh, were also present.