The central bank of Bangladesh yesterday launched National Payment
Switch (NPS), a common platform for the country's commercial banks for
electronic payments, which is going to revolutionise e-commerce in
Bangladesh.
“The advantages of this new payment
platform are enormous. E-commerce will spread across the country,” said
Bangladesh Bank (BB) Governor Atiur Rahman.
Once
all banks in Bangladesh join the NPS, a customer using a credit or
debit card of any bank will be able to draw cash from any ATM and POS
(point of sales) in the country. And transaction costs will
significantly go down as the transactions will be routed through the NPS
instead of Visa, Master or Amex card networks abroad.
Moreover, purchase and sale can be done with cards through the internet and web portals within the country.
Only
three banks -- Dutch-Bangla, Pubali and Southeast -- have so far joined
the NPS. BB officials said it will take two or three months for all
banks to join the network.
However, Naznin Sultana, deputy governor of central bank, said all banks will join the NPS in one month.
The
BB governor said the NPS will facilitate easy access to funds, an
increase in tax revenue, more flow of money in the economy, and
financial inclusion. He said the BB will also be able to supervise banks
prudently as electronic transactions will be made through a single
switch.
“Banks will not need to pay network
fees to the Visa or Master Card. Banks can ultimately reduce fees paid
by customers,” said Ahsan Ullah, BB executive director, and project
director of the Central Bank Strengthening Project, under which the NPS
has been installed.
The central bank has set
up the NPS at a cost of US$5 million funded by the World Bank. It took
more than three years to install it.
Though
many Asian and African countries have the system in place for long,
Bangladesh took quite a while to a set up a common electronic payment
platform to help banks and their clients make transactions in an easy
and cost effective way.
Individual payment platforms introduced by different banks will be abolished once all banks join the common platform.
Bankers
have hailed the move, saying it will reduce their capital expenditure
significantly and help deliver services to clients at a much faster
pace.
“Banks can cover more areas and clients
by using the existing number of ATM and POS,” Abul Kashem Md Shirin,
deputy managing director of Dutch-Bangla Bank Ltd, told The Daily Star.
“It's
a big day,” said Helal Ahmed Chowdhury, managing director of Pubali
Bank. He said the NPS will facilitate transactions between banks.
Mahbubul
Alam, managing director of Southeast Bank, said a national
infrastructure has been built with the installation of the NPS.
“It will help us make settlements in no time. It will also reduce costs,” said Alam.
Nurul
Amin, chairman of Association of Bankers Bangladesh, and the managing
director of NCC Bank, said the NPS will increase transparency in
transactions.
(China Daily)