Mobile banking grows 29%, cards transaction 6% year-on-year

People's trend towards availing digital banking services has been increasing more than ever recently, thanks to the emergence of Covid-19.

The pandemic-led countrywide shutdown that lasted 66 days, coupled with the obligation to maintain social distancing, had kept customers away from in-person branch interactions, promoting them to go for digital transactions.

That is why the number of transactions through cards increased by 6%, mobile banking by 29% and internet banking by 22% in 2020 year-on-year, according to the Monthly Economic Trends report published by the Bangladesh Bank on Thursday.

Bankers say customers had been getting used to digital banking even before the Covid-19. The pandemic has just fast-tracked the digital transformation.

Banks are now emphasising strengthening their digital transaction mediums and keeping such services uninterrupted.

When contacted, AYM Mostafa, chief technical officer (CTO) of Prime Bank, told The Business Standard that they need to introduce more digital products because of people's rapid shift toward digital banking. Many banks have already started working on it.

Banks are increasing investment in this sector to keep up customer satisfaction. Bank boards are also playing a positive role in this regard, he said.

Talking about internet banking, he said the number of internet banking customers is very low compared to those of banks. Internet banking subscriptions should be enhanced.

It is true that the number of new customers has increased owing to the pandemic last year, but he thinks that the old customers have done more transactions.

As part of digital banking, banks have now introduced electronic Know Your Customer (e-KYC) system that allows account opening without going to a bank branch.

But, customers still have to come to banks for other works, such as for receiving cards or cheque books, said Mostafa, adding that arrangements should be made so that they do not have to come for such purposes too.

Banks have also started using artificial intelligence to inform customers about any problems or queries related to banking as part of the process of digitisation of banks, Mostafa said.

In the next three to four years, half of the customers will use digital mediums to avail themselves banking services, the banking technologist pointed out.

Meanwhile, mobile banking witnessed 29% growth year-on-year in 2020 and this trend continues this year as well.

Furthermore, as remittances have increased, so has the use of mobile banking in paying salaries to employees in business establishments.

However, transactions through mobile banking for utility bill payments and purchases declined in January this year month-on-month.