Telcos should have active participation in MFS

Telecom regulators of South Asian nations yesterday said mobile operators should have active participation in mobile financial services.

Telecom regulators should be given a fair share in the process of regulating the MFS business, they said.

The demands were placed at the opening session of the three-day summit of South Asian Telecommunication Regulatory Council (SATRC), which is a body of all the telecom regulators in the Saarc region.

They also made it clear that since MFS is a banking service, banks will lead it, but they want control over the telecom aspects.

Bangladesh Telecommunication Regulatory Commission hosted the event, which has been organised by Asia-Pacific Telecommunity (APT), at Le Meridien Hotel, Dhaka.

Speaking at a session on "evolution of regulatory framework in South Asia and Asia-Pacific: the regulatory tools required", RS Sharma, chairman of Telecom Regulatory Authority of India, said, "Our position is very clear here. Banks will regulate their part. For their service, the banks are using telecom infrastructure. So our regulations will also have to apply."

In India, some mobile phone operators have also received the MFS licence, and over there, they are trying to reduce the cost of telecom infrastructure, which will help make the service affordable for all, he said.

"For me, banking information is like any other message or content that is transmitted through the telecom infrastructure and telecom regulators or operators can't be responsible for that," he added.

Pakistan Telecommunication Authority's Chairman Syed Ismail Shah said they had a memorandum of understanding with their central banks on MFS services.

He said they have their own regulation and banks have their regulation, and both parties are responsible for their own parts.

In Pakistan, mobile operators can run MFS services; they can even buy and run commercial banks, Shah added.

In Bangladesh, MFS services are being run by the banks. So far, there are around 3.66 crore active accounts with monthly transaction values increasing at 7 to 8 percent.

Regulators in Afghanistan and Nepal said they are going through a bank-led model, but are ensuring active participation of the telecom regulators.

Afghanistan Telecom Regulatory Authority's Chairman Mohammad Najeeb Azizi said the voice business is dying and that is why the mobile operators will have to redesign their business models.

Mobile operators will have to play with data and here, MFS can be a part of their service, Azizi added.

Azizi said regulators have to protect the interests of investors and for doing that "we have to help them create new window for digital business like MFS." 

Earlier in the opening session, Bangladesh's Law Minister Anisul Huq said regulators should find a common framework of MFS for the entire region.

"I want to request the members of this forum to interconnect mobile financial services within the region, hence promoting trade and commerce among the people of the region."

Considering the socio-economic condition and general literacy rate, it may not be commercially feasible for the banks to deliver the financial services to the remotest corner of the country, he said.

Here, the mobile industry can play a significant role, utilising the infrastructure they have deployed over a few decades, he added.

MFS is considered one of the revolutionary inventions in terms of economic inclusion around the world, the minister said.

"In today's world, financial inclusion is a key to social inclusion and it is necessary to foster inclusive growth and combat poverty. That is why 'digital financial inclusion' remains as one of the core elements of a 'Digital Bangladesh' vision."

State Minister for Foreign Affairs Mohammed Shahriar Alam said the Bangladesh government has invested heavily in ICT to develop quality human resources.

BTRC Chairman Shahjahan Mahmood said, in the last seven years, the country saw tremendous development in digitisation.

By this time, internet penetration reached around 40 percent from 5 percent in 2009 and mobile penetration crossed 80 percent.

After the opening session, Mahmood was elected the new chairman of SARTC and he will hold this position till the next SARTC summit.

Another 90 foreign and local experts are taking part in the council meetings that will conclude tomorrow.