Joy resolves tussle in mobile financial service | The Daily Star
12:00 AM, April 17, 2018 / LAST MODIFIED: 01:26 PM, April 17, 2018

REVENUE SHARING BETWEEN BANKS AND TELCOS

Joy resolves tussle in mobile financial service

Sajeeb Wazed Joy, Prime Minister's ICT affairs adviser, yesterday in a meeting has resolved a longstanding tussle between the mobile financial service providers and mobile operators.

The MFS providers use the mobile operator's Unstructured Supple-mentary Service Data (USSD), which allows banking services from one's basic feature phone without the need for internet connection, to relay their service.

In return, the MFS providers share 7 percent of their earnings with the mobile operators, much to the dissatisfaction of the latter.

But now, the MFS providers will have to pay the carriers according to usage. For each 90-second session Tk 0.85 will be charged provided a successful transaction had taken place.

Customers will get two text messages, the cost for which will be bundled within the Tk 0.85 charge.

For other non-transactional services such as checking balance, the MFS providers will have to pay Tk 0.40, which they did not previously.

At present, the MFS providers charge the customers 1.8 percent of the amount as transaction fee.

For instance, if a customer sent Tk 10,000 through agent, his/her charge would be Tk 180. Of the Tk 180, the MFS providers forward Tk 25.71 to the mobile operators.

“As we are not changing the customers' charge right now there may not be any reaction from them,” said Abul Kashem Md. Shirin, managing director and chief executive officer of Dutch-Bangla Bank, the parent company of the second largest MFS provider 'Rocket'.

The changes might increase their cost of delivering the service but they will absorb it and later report to the government to review it again.

Earlier, both the market leading MFS operators bKash and Rocket claimed that the development might ward off the end users.

But yesterday, after the meeting they said they will absorb the changes and after one or two months they will sit to find out the impact. However, mobile operators said there was a lack of clarity in the revenue-sharing model. Now, there will be transparency and definitely it will not increase end users costs.

“This is a business to business price and no way to impact customers' charges. Rather they will get benefit when this change is implemented,” said TIM Nurul Kabir, secretary general of the Association of Mobile Telecom Operators of Bangladesh.

Kabir said USSD is a service from the operators like voice calls, SMS and internet services and without regulation they could not continue to provide it as demand is increasing. “Plus, it creates pressure on the mobile operators' network.”

MFS started in Bangladesh in 2011. At that time, the USSD price was not fixed and an ad hoc basis revenue sharing model was established. Last December, some mobile operators even said they could not serve the MFS operators by disrupting their own business and reduced service in peak hours.

Top officials from mobile operators, mobile financial services providers and banking and telecom regulator, telecom minister were present in the meeting at the prime minister's official residence.

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