Branchless Banking (BB) continues to post a notable growth in all key indicators and the total value of the BB transactions have reached historical mark of Rs802 billion, up by 63 per cent during the year of 2013. Industry sources told Business Recorder on Saturday that Pakistan has become one of the fastest growing markets for the BB in the world and likely to further grow in coming years.
The State Bank of Pakistan (SBP) issued Branchless Banking Regulations in 2008 and presently, all five mobile operators in Pakistan have already launched their branchless banking services with collaboration of the largest banks.
While some other leading banks are also offering branchless banking services. These efforts by the mobile operators and banks have resulted in a healthy growth of branchless banking during the last year, besides supporting the SBP's financial inclusion programme.
Industry sources said that all indicators of branchless banking are positive and witnessed a massive growth during the last calendar year (CY13). The value of transactions and the number of branchless banking accounts are increasing steadily and accounts have crossed a mark of 3 million at the end of CY2013. Whereas, the countrywide agents' network has also expanded to 0.12 million end of the last year.
According to the State Bank's fresh statistics overall 192 million BB transactions were conducted during the CY13 compared to 121 million in the CY12, depicting a surge of 59 per cent. Similarly, the value of the BB transactions have gone up by 63 per cent or Rs 310 billion to Rs 802 billion at the end of CY13 as against Rs 492 billion in CY12.
The average size of transaction was Rs 4,182 in the CY13, while the average number of transaction per day surged to 525,758 during the year ended as on December 31, 2013 up from 331,096 during the previous year.
In addition, a growth of 65 per cent or over one million was registered in the BB accounts during last year as it reached 3.47 million in CY13 compared to 2.1 million in CY12. Total number of the BB agents expanded to 125,027 in CY13 relative to 41,567 in CY12. Total deposits as of date surged to Rs 2.639 billion up from Rs 1.055 billion.
However, with the arrival of new players in the market the country's BB is facing a stiff competition. The rising competition has also forced the market players to work on technological innovation, new business models, timely delivery of payment and transformation in customers' needs, industry sources said.
They said that still a large number of people particularly women are unbanked mainly due to awareness and limited bank branches network. Women in rural and remote areas face additional constraints due to lack of their mobility largely for cultural reasons.
As a regulator of banking sector, the SBP has already directed banks to open 20 per cent new branches in rural areas aimed to reduce the number of unbanked persons. In addition to this, the SBP is fully supporting the BB and making serious and sound efforts for the success and development of this sector.
"Technology has, however, been changing the dynamics of retail banking in Pakistan and in the present scenario branchless banking is more successful, comfortable, popular and easy way of banking transactions instead of retail banking", they mentioned.
The BB offers unique services, under which anywhere and anytime, the unbanked individuals can now avail basic financial services at agent shops which are in close proximity to their residence. Currently, eight branchless banking providers have developed a network of 125,000 agents to provide services including bills payment, fund transfer, G2Ps, loan repayments and others, they informed.
"Major accountholders of mobile-wallet accounts were previously unbanked and out of 3.4 million BB accounts some 38 per cent is being contributed by women," they pointed out.
Industry sources said that the SBP is committed to providing the BB players an enabling policy environment along with actively supporting market development. "We expect that the SBP will continue to play policy advocacy role in branchless banking development," they concluded.
Comments
Comments are closed.