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18 June, 2019 00:00 00 AM / LAST MODIFIED: 18 June, 2019 02:31:25 AM

New charge will negatively impact the end users, say MFS providers

Mobile financial service costs likely to go up

BTRC fixes session-based USSD charges
Mobile financial service costs likely to go up

The Bangladesh Telecommunication Regulatory Commission (BTRC) yesterday fixed charges for unstructured supplementary service data (USSD) and short message service of mobile financial services (MFS), a move that might raise the services cost. 

The MFS providers use the mobile phone operators’ USSD, which allows banking services from one's basic feature phone without the need for internet connection, to relay their services. In return, the MFS providers share 7 percent of their earnings with the mobile operators, much to the dissatisfaction of the mobile operators.

Now, the MFS providers will have to pay the carriers according to usage.

For each 90-second session Tk 0.85 will be charged provided a successful transaction has taken place. Customers will get two text messages, the cost for which will be bundled within the Tk 0.85 charge.

For other non-transactional services such as checking balance, the MFS providers will have to pay Tk 0.40, which they did not previously.

The BTRC directives, signed by Lt Col Mohammad Azizur Rahman Siddiqui, director of the Systems & Services Division under BTRC, said revenue generating services have to be declared as per the existing invoice and no one is authorised to change that service type without prior permission from BTRC.  

All tariffs mentioned exclude VAT 

and tax.

According to the directives, a charge will be applicable for technically successful USSD session other than MFSP’s technical failure and for that matter the session will be termed "chargeable USSD session". 

Both mobile phone operators and MFS operators will make arrangements to find out the error code specifying the fault, which would be mentioned in the agreement, the directives read. 

When asked whether the MFS service provider will give the new charge to the mobile operators from the revenue earned, or will the customer be forced to pay it, Shamsuddin Haider Dalim, 

head of Corporate Communications and PR of the leading MFS provider bKash, told The Independent: “We have not yet received any directive about this. So, we cannot make any comment on it right now.” 

“We welcome comprehensive combined directive on MFS. Our long-standing demand for the introduction of session-based charging has finally been incorporated after four-year-long discussion and consent of Bangladesh Bank, BTRC, MNOs and MFS. Customers don’t have any reason to worry about any additional charge due to this directive since such charges are going to be paid by the MFS service provider to the mobile operators,” said Shahed Alam, Chief Corporate and Regulatory Officer, Robi Axiata Limited.  

Session-based USSD charge mechanism for mobile financial services was an apple of discord between the mobile financial service providers and mobile phone operators. At present, the MFS providers charge the customers 1.8 percent of the amount as transaction fee.

For instance, if a customer sends Tk 10,000 through agent, his/her charge will be Tk 180. Of the Tk 180, the MFS providers forward Tk 25.71 to the mobile operators.

Earlier, the BTRC prepared the USSD pricing policy after consultations with the finance ministry, Telecom Division, Bangladesh Bank, mobile financial service providers and the Association of Mobile Operators of Bangladesh (AMTOB).

The draft guideline was sent to the posts and telecommunications and ICT ministry.

Later, a coordination meeting was held on July 24 and August 1 last year. At the meeting, it was decided that the definition of revenue-generating transactions and non-revenue generating transactions would be determined following the definition of the session-based USSD pricing guidelines.        

According to the proposed directives, the duration of a USSD session is 90 seconds and the charges would be Tk. 0.85 for MFS, along with two free short messages.

A USSD session is completed through a set of code numbers that are pressed on a mobile phone to initiate a transaction.

The USSD is a global system for mobile communication technology for sending text messages between a mobile phone and an application programme in the network.

MFS providers have claimed if the new pricing regime is established, it will negatively impact the end users.

Currently, MFS providers share 7 per cent revenue with mobile operators, as they use the networks of mobile network operators. However, session-based USSD charges are the standard in such cases.

The mobile wallet market in Bangladesh was expected to gain momentum in 2019 as a global report forecasts its growth to US$ 250 billion by 2024 from over US$ 100 billion in 2017.

US-based Global Market Insights, in its report released recently, says the mobile wallet market is expected to grow from over USD 100 billion in 2017 to USD 250 billion by 2024. It suggests that the growth is influenced by attractive discounts and cashback offers by mobile wallet providers.

The mobile wallet market in Bangladesh is growing with increasing digital shopping, introduction of the QR code and cash back offers by some MFS operators.



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Editor : M. Shamsur Rahman

Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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