FE Report (November 25, 2010)
BRAC Bank has taken a series of plans in its strong efforts for more industry initiatives to harness the full economic benefits of the banking and financial sector of the country.
"The next is going to be a major step towards financial inclusion - a mobile banking solution that is far more comprehensive than whatever is being offered now, or are on the cards in the industry - by early next year," Syed Mahbubur Rahman, Managing Director & CEO of BRAC Bank told the FE in an interview recently.
The bank is currently working on expanding into newer services through subsidiaries.
"We have already entered the capital market through BRAC EPL - a merchant bank and a brokerage house - to offer full array of services," he said.
On crossing a million-mark of customers, the MD said: BRAC Bank is the youngest in the industry. Having one million customers on board in just 9 months makes it the fastest in the industry. In fact, among the private sector banks, this is certainly one of the largest ones.
From the industry and business point, a base of one million customer proves the strength that the bank has. From our point, having so many customers - or rather guests as we call them - proves the unshakeable trust they have put on us. In either ways, it is a great reward indeed.
Replying a question on entering into public private partnerships (PPP), he said most of the PPP in Bangladesh and its neighboring ones have been in infrastructure or power or real-estate development sectors.
"But BRAC Bank and Rupali Bank teamed up in a PPP for the first time in banking industry of the country," he added.
Under this deal, BRAC Bank will install 50 ATMs at various Rupali Bank locations and also issue around 0.2 million ATM cards without any issuance fee for Rupali Bank customers. This will allow customers of Rupali Bank to access more than 700 ATMs across the country instantly.
"Through this partnership, we can bring at least 200,000 people almost over-night to the automated banking network.
For a state-owned bank like Rupali Bank that has almost 500 branches across the country, automating its system means a hefty amount of foreign exchange expense and a long, multi-year process," he added.
"From day one, the bank is fully automated; today we run the largest real-time online network in terms of transactions and reach with our ATMs, shared networks, branches, POS and SME Service Centers. We have more than 7,850 employees to cater to the need of this large customer base."
He said every year, BRAC Bank has opened new branches and more than 45% of the branches are in the semi-urban and rural area to ensure that BRAC Bank serves closer to customers.
"On PPP initiatives, we have been working with Rupali Bank since earlier this year. A concept like this has always been on talks. And thanks to our Honorable Governor, a new initiative like this between a public and private bank always had a positive encouragement from Bangladesh Bank. When you have the regulators working as a catalyst and when you have less bureaucracy, there is no stopping to the immense opportunity that PPP models can offer.
"We, from BRAC Bank, have led OMNIBUS and ELDORADO, two industry initiatives. OMNIBUS is a common network of ATM and POS machine. We developed it, invested into the technological and management resources for the project, and have been inviting banks to join in. Today we have more than 700 ATMs in the network from about 30 banks."
ELDORADO is another a common platform - this one is mainly for distributing foreign as well as local remittances through any branches of the member banks on a web-based interface. We already have 11 banks in this network! So surely our experience says, if someone is ready to take the step forward, there are others who is willing to join in.
On mobile banking, he said : We believe that mobile could be a highly user-friendly, easily accessible channel to reach to this unbanked population with financial and banking services. It will certainly reduce cost on both end, but more than that is the great jump we'll see in formal GDP. As soon as people start saving money in their 'mobile-wallet', they will be counted into GDP - the economic potential is huge.
Replying to a question on the role of regulators in such a growing institution like BRAC Bank, he said a regulator's role is more of facilitator's these days. The current governor certainly has stepped out of the academic definition of a Central Bank's role and playing a role of a positive catalyst to expand the reach of banking, improve the quality of the industry and taking long-term strategic steps.
"Yes, there will always remain a scope of improvement, but we have seen the regulators these days to be more inductive for sustainable growth in the sector, I'd say."
On other plans of BRAC Bank, he said certainly, our focus will remain our guests - the customers.
"We are constantly evaluating their needs as well as assessing economic trends - you'll soon see more solutions coming from BRAC Bank for our 'guest satisfaction'. We have been lucky to have a million customer this far and together we hope to cross many more milestones."
BRAC Bank has taken a series of plans in its strong efforts for more industry initiatives to harness the full economic benefits of the banking and financial sector of the country.
"The next is going to be a major step towards financial inclusion - a mobile banking solution that is far more comprehensive than whatever is being offered now, or are on the cards in the industry - by early next year," Syed Mahbubur Rahman, Managing Director & CEO of BRAC Bank told the FE in an interview recently.
The bank is currently working on expanding into newer services through subsidiaries.
"We have already entered the capital market through BRAC EPL - a merchant bank and a brokerage house - to offer full array of services," he said.
On crossing a million-mark of customers, the MD said: BRAC Bank is the youngest in the industry. Having one million customers on board in just 9 months makes it the fastest in the industry. In fact, among the private sector banks, this is certainly one of the largest ones.
From the industry and business point, a base of one million customer proves the strength that the bank has. From our point, having so many customers - or rather guests as we call them - proves the unshakeable trust they have put on us. In either ways, it is a great reward indeed.
Replying a question on entering into public private partnerships (PPP), he said most of the PPP in Bangladesh and its neighboring ones have been in infrastructure or power or real-estate development sectors.
"But BRAC Bank and Rupali Bank teamed up in a PPP for the first time in banking industry of the country," he added.
Under this deal, BRAC Bank will install 50 ATMs at various Rupali Bank locations and also issue around 0.2 million ATM cards without any issuance fee for Rupali Bank customers. This will allow customers of Rupali Bank to access more than 700 ATMs across the country instantly.
"Through this partnership, we can bring at least 200,000 people almost over-night to the automated banking network.
For a state-owned bank like Rupali Bank that has almost 500 branches across the country, automating its system means a hefty amount of foreign exchange expense and a long, multi-year process," he added.
"From day one, the bank is fully automated; today we run the largest real-time online network in terms of transactions and reach with our ATMs, shared networks, branches, POS and SME Service Centers. We have more than 7,850 employees to cater to the need of this large customer base."
He said every year, BRAC Bank has opened new branches and more than 45% of the branches are in the semi-urban and rural area to ensure that BRAC Bank serves closer to customers.
"On PPP initiatives, we have been working with Rupali Bank since earlier this year. A concept like this has always been on talks. And thanks to our Honorable Governor, a new initiative like this between a public and private bank always had a positive encouragement from Bangladesh Bank. When you have the regulators working as a catalyst and when you have less bureaucracy, there is no stopping to the immense opportunity that PPP models can offer.
"We, from BRAC Bank, have led OMNIBUS and ELDORADO, two industry initiatives. OMNIBUS is a common network of ATM and POS machine. We developed it, invested into the technological and management resources for the project, and have been inviting banks to join in. Today we have more than 700 ATMs in the network from about 30 banks."
ELDORADO is another a common platform - this one is mainly for distributing foreign as well as local remittances through any branches of the member banks on a web-based interface. We already have 11 banks in this network! So surely our experience says, if someone is ready to take the step forward, there are others who is willing to join in.
On mobile banking, he said : We believe that mobile could be a highly user-friendly, easily accessible channel to reach to this unbanked population with financial and banking services. It will certainly reduce cost on both end, but more than that is the great jump we'll see in formal GDP. As soon as people start saving money in their 'mobile-wallet', they will be counted into GDP - the economic potential is huge.
Replying to a question on the role of regulators in such a growing institution like BRAC Bank, he said a regulator's role is more of facilitator's these days. The current governor certainly has stepped out of the academic definition of a Central Bank's role and playing a role of a positive catalyst to expand the reach of banking, improve the quality of the industry and taking long-term strategic steps.
"Yes, there will always remain a scope of improvement, but we have seen the regulators these days to be more inductive for sustainable growth in the sector, I'd say."
On other plans of BRAC Bank, he said certainly, our focus will remain our guests - the customers.
"We are constantly evaluating their needs as well as assessing economic trends - you'll soon see more solutions coming from BRAC Bank for our 'guest satisfaction'. We have been lucky to have a million customer this far and together we hope to cross many more milestones."
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