• Sunday, Nov 27, 2022
  • Last Update : 10:24 am

How the pandemic made banks go online faster

  • Published at 03:17 pm April 19th, 2021

Demand for digital banking services has also been at an all-time high

Even before the pandemic banks were slowly adapting to online systems but once lockdowns started last year, it was apparent that the future of many transactions would be online.

Demand for digital banking services has also been at an all-time high, enabling them to take more initiatives for establishing a digital ecosystem and provide technical solutions without having to visit branches physically.

Internet banking transactions rose 34.58% year on year to Tk8,477.3 crore in February this year, as per recent Bangladesh Bank data.

The users of internet banking also rose 29.83% in the last one year, until February this year.

Besides, debit card transactions rose 22.24%; credit card transactions 23.89% and prepaid card transactions rose 15.97% in the last one year, as per BB data.

Last year, in face of the growing first wave of the pandemic, most banks introduced mobile banking app, WhatsApp banking and online account-opening platforms.

Most of them increased their investment in internet banking, establishing smart ATM machines such as cash deposit machines (CDM) and cash recycling machines (CRM), also expanding their agent banking and mobile financial services.

Meghna Bank is en route to digitalizing its banking operations, said its managing director Sohail RK Hussain.

He also said that the fourth generation bank plans to invest about at Tk20 crore to upgrade its system and digital financial services.

“The bank is expanding its internet banking, agent banking, upgrading its mobile financial services and going to introduce social media banking within next four to five months,” said Hussain.

“Digital banking is very essential to reduce operational cost,” said Hussain, adding that all types of digital banking will be available at the bank from next year.

City Bank has invested big in digital banking as well.

The bank introduced a mobile app –Ekhoni Account, through which anyone can open a bank account by installing the app on their smartphone within minutes from home, without needing to visit their branches.

“Citytouch, another digital banking service of the bank, is where the bank's account holders can borrow up to Tk1 lakh through client’s internet-enabled devices against their fixed deposits scheme,” said Md Zafrul Hasan, head of digital financial services of City Bank.

Last year, the bank collaborated with bKash to begin offering a first-of-its-kind digital loan that will enable users to request and receive loans instantly through bKash. 

bKash users can borrow up to Tk10,000 from the bank instantly by using their bKash app.

The initiative has been launched as a pilot project, but the bank is soon going to launch it commercially.

Zafrul also said that the bank plans to invest $4-5 million for digital banking services to meet the growing demand of their clients.

“Brac Bank started to invest in digital banking before the pandemic, but the present situation of the pandemic further enhances the importance of digital banking,” said its managing director Selim RF Hussain.

He also said that the transaction in digital banking of BRAC Bank was 16-17% just a year ago, but now it has increased to 42%.

Recently the bank introduced a Mobile App-“Brac Bank Astha”. Clients of the bank can make all kinds of banking transactions through the app.

Brac Bank's investment in technology has averaged approximately $20 million, or Tk170 crore in three years, from 2018 until 2020.

Hussain also said that the next four to five year’s development of digital banking has already been done in a year, owing to the global pandemic.

“Eastern Bank has also taken several initiatives and increased its investment in digital financial services amid the Covid-19 pandemic,”said its managing director Ali Reza Iftekhar.

He did not disclose the figure of investment but said that Eastern Bank’s digital transaction rose 250% in the last one year.

To address the rising trend in online purchases and consumer preference to transact online, the bank in partnership with MasterCard and home delivery network Paperfly last year launched “Cashless Pay”- a digital payment-on-delivery solution.

“Banks should come forward to invest in digitization because establishing a digital ecosystem and technical solution is very essential in future banking,” said Ali Reza Iftekhar, also the chairman of the Association of Bankers Bangladesh (ABB).

He said that the present Covid-19 situation proved that banks should take more initiatives for digitalization to make a cashless society.

“Amid the pandemic in last year, Dhaka Bank introduced mobile banking app “DBL GO”, and also introduced a few tech-based products for its small and medium enterprise customers as well,” said its managing director Emranul Haq.

“We were the first to introduce ‘WhatsApp Banking’, through which our customers can access their accounts and execute their transactions without any hassle amid the pandemic,” he added.

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