Central bank plans directive to regulate e-banking
KATHMANDU, JUN 21:
Amid increasing popularity of internet- and mobile-banking services, the Nepal Rastra Bank (NRB) is all set to introduce a directive to regulate the sector.
NRB Deputy Governor Maha Prasad Adhikari disclosed this fact while addressing the first ever Mobile Financial Services Summit that kicked off here on Wednesday. The directive will cover internet banking, mobile banking and card business, Adhikari said. “The directive is being brought so as to regulate risks associated with the products,” said Adhikari. “It talks of services, service quality and risk management.”
Once the directive comes into effect, banks and financial institutions (BFIs) will have to acquire NRB permission to launch products related to e-banking and mobile banking. The directive talks about arrangements between operators and appointment of agents, among others. “As such services involve parties who have not been licensed to carry out financial activities, the directive talks about monitoring them, if needed,” said Adhikari.
The two-day summit is being organised by USAID Nepal to discuss opportunities to overcome the challenges of implementing mobile financial services in the country. USAID Deputy Mission Director Sheila Lutjens said mobile banking has a huge potential in Nepal, as just 25 percent of the Nepali population has bank accounts. “Only 25 percent of Nepali people have bank accounts, while the mobile phone penetration rate is already 37 percent and is growing rapidly,” said Lutjens.
Experts said mobile banking will also make banking services affordable to the people. Quazi Shoaib Ahmad, head of micro-financing policy and development at the State Bank of Pakistan, said mobile banking is a cost effective way to promote banking.
“Agents cost is 76 times less than a bank branch and replacing agents with a mobile phone will further cut the cost by half,” said Ahmad.
Over the last three years, commercial banks have increasingly been adopting new technologies to deliver financial services to the unbanked. The launch of Mobile Money by Laxmi Bank, Mobile Cash by Kumari Bank and Mobile Wallet by Bank of Kathmandu are some of the initiatives on mobile banking in the country.
Mobile banking is set to take off in a big way with five BFIs signing MoU with Finaccess Pvt Ltd to launch inter-operable mobile banking using the Hello Paisa platform. The pacts represent a major step towards mobile banking.
Hello Paisa is the country’s first and only share access mobile financial services platform. BFIs that have signed MoUs with Finaccess are Laxmi Bank, Bank of Kathmandu, Siddhartha Bank, Commerz and Trust Bank and International Leasing and Finance Company.
Among these banks, Laxmi Bank has already started its products ‘Mobile Khata’ based on Hello Paisa platform. The bank is currently running this product as pilot in Sindhupalchowk.
Source: The Kathmandu Post
