Lenders see rise in internet banking amid pandemic
Nayeem Uddin, a university professor by profession, encountered immense difficulties in settling banking transactions between April and May, when strict movement restrictions were imposed by the government to curb the spread of the coronavirus.
However, online banking has enabled Nayeem to resolve the crisis by helping him send money to relatives without having to visit a physical bank branch.
“I discovered online banking at least two or three years ago, but I didn’t feel comfortable using it. So I did all of my banking in person by going to a branch, ”he said.
Initially, Nayeem had problems trying to send money through online banking, but it ultimately made his life easier than ever.
“While there are no restrictions on movement at the moment, I am now used to paying down payments for both my deposit pension plan and my loan using the digital banking platform,” said he added.
With just a smartphone, you can settle almost all types of transactions because a significant number of banks have already introduced their own applications.
“Now I even pay the rent for my house through the app. The pandemic has changed my lifestyle dramatically, but one of the best changes is being able to use technology to settle financial transactions,” Nayeem said.
Nayeem is just one of many who have recently embraced internet banking as part of their efforts to keep the deadly coronavirus at bay.
Internet banking transactions and the number of users of the service have grown at a faster rate in recent months.
The total value of transactions made through online banking was Tk 6,800 crore in August, up 46.36% year-on-year, while users of the service grew by nearly 30% to 29.20 lakh, according to central bank data.
There is no doubt that the use of online banking services will become much more popular in the days to come, as many local banks are reluctant to open branches, a Bangladesh Bank official said.
For this reason, lenders have recently taken several initiatives to adopt the branchless banking model, which includes agent banking, mobile financial services, etc.
The Mutual Trust Bank will open a maximum of 1 to 2 branches for a year, as it has programs in place to popularize digital banking, said Syed Mahbubur Rahman, chief executive of the bank.
Branchless banking will help lenders dramatically cut costs at a time when customers receive faster and safer service.
“Internet banking is one of the most sophisticated tools for the expansion of digital financial services,” he said, adding that Mutual Trust Bank has witnessed a rapid increase in the number of users of Internet banking in the midst of the pandemic.
Customers can now benefit from various financial services from the comfort of their own homes using the ‘MTB Smart Banking’ app.
The app helps customers retrieve their account statements, transfer funds from one bank to another, top up their mobile balance, and pay utility and credit card bills.
Up to 278,600 Mutual Trust clients now settle their transactions through the lender’s online banking platform.
Between July and August, Dhaka Bank conducted a special campaign to popularize online banking services so that people are encouraged to engage in branchless banking, said Emranul Huq, managing director of Dhaka Bank.
During the campaign, the lender also introduced a new service that helps customers open bank accounts from home.
An account opening form is available on the Dhaka Bank website. Customers can get the required document by clicking on a link and after filling it out, the customer can submit it online, Huq said.
Representatives from Dhaka Bank even provide the debit card and checkbook services required by the respective customers so that they can avoid going to a branch, he said.
“The campaign has attracted 32,000 new customers to the bank. Customers also benefit from online banking,” Huq said.
Dhaka Bank Go – a lender’s mobile app – has already gained popularity with customers in recent times, he added.
Dutch-Bangla Bank’s (DBBL) online banking service, which was introduced in 2004, has managed to gain popularity amid the pandemic, according to the lender’s chief executive, Abul Kashem Md Shirin.
“Two lakh clients are now using the online banking service to transfer their funds from DBBL to other banks,” he said.
In addition, 29 lakh customers are now using the lender’s NexusPay app to settle intrabank transactions.
“Settlement of funds through online banking has gained momentum in recent months. Settling funds digitally is now a regular habit for customers,” said Shirin.
The number of Eastern Bank customers who bank online has increased by at least 25% amid the ongoing pandemic, said Ziaul Karim, communications and external affairs manager at Eastern Bank.
At least 2 lakh customers are now using EBL Skybanking – the bank’s mobile app – to complete their required financial transactions, he said.
The Bangladesh Bank has recently increased the limit for interbank funds transfers through online banking services in order to meet customer requirements.
Clients can now trade a maximum of 5 lakh Tk per day against the previous cap of 2 lakh Tk, according to a central bank notice published on September 6.
The Bangladesh Bank also specified for the first time the transaction limit on Internet banking services for commercial institutions.
Any business entity will be allowed to transfer 10 lakh Tk and perform a maximum of 20 transactions per day under Internet interbank banking services, as advised by the central bank.
The increased cap set by the central bank has pushed internet banking even further, the Bangladesh Bank official said.