SBP Considering Teleco Led Branchless Banking

By Arsalan Mir | March 20, 2010 | 1 Comment

We have taken a look at the permissible branchless banking models in our earlier post and have seen them all to bank led. At the third international mobile commerce conference recently held State Banks’s Deputy Governor, Yaseen Anwar, has indicated of a Teleco led model of branchless banking is being considered. The staff report from Dawn News gives the details.

The State Bank of Pakistan is considering introducing a new non-bank led and Telco led model of branchless banking, said deputy governor of State Bank, Yaseen Anwar, while speaking at the third international mobile commerce conference in Pakistan on Thursday.

He said this adds a totally new dimension to regulation that extends beyond the direct supervisory role of the SBP.

“We may need to establish, as in some countries, a National Payments Council that will include other stakeholders to regulate this rapidly expanding business sector.”Mr Anwar said that the SBP has issued guidelines for branchless banking as part of a broader strategy to create an enabling regulatory environment with the objectives of promoting financial inclusion.

He said branchless banking is a significantly cheaper alternative to conventional branch-based banking as it allows banks to offer financial services outside traditional bank premises.

“One inherent power of branchless banking is that it can be used to substantially increase the financial services outreach to the un-banked communities and in a broader perspective provides ways and means in the promotion of financial inclusion in the country,” he added.

At the same conference the PTA Chairman, Dr. Muhammad Yaseen, said that Pakistan Telecommunication Authority has joined hands with the State Bank of Pakistan to produce an all – inclusive mobile banking regulatory frame work which is to be finalised very soon. Daily Times gives the details about this.

Dr Yaseen said billions of mobile and online internet users worldwide are creating huge opportunities for the development of new means of commerce like e-commerce and m-commerce. However, the industry’s growth and its development impact can only be maximized, if stakeholders work together towards identifying the appropriate policy and business models that can achieve scalability. He said, “we have joined hands with the State Bank of Pakistan to produce an all inclusive mobile banking regulatory frame work which is to be finalised very soon”. He said the global mobile money industry has grown significantly in size and scope and there are various modes of transactions via your bank branch, call centers, IVR, ATM online and mobile phones. Amazingly, the lowest of all is mobile money transaction costing around $0.08 per transaction. He said the mobile money not only provides convenience but the lowest transaction cost as well, according to the World Bank, Pakistan is amongst the top 20 remittance – receiving economies with a size of $6.1 billion by 2007. This proves realistic market availability for kick starting various modes of mobile money, he added.

With this regulation coming forward we can expect more telecom players entering in to the mobile banking domain.

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