Report On

Risk Assessment of Products in bKash

By

Iffat Rubaiyat
ID: 15104189

An internship report submitted to the BRAC Business School in partial fulfillment of the
requirements for the degree of
Honors

BRAC Business School

BRAC University
Date of Submission: 25th August, 2019

Fall 2019, BRAC University

 Declaration

It is hereby declared that

1. The internship report submitted is my own original work while completing degree at

BRAC University.

2. The report does not contain material previously published or written by a third party,

except where this is appropriately cited through full and accurate referencing.

3. The report does not contain material which has been accepted, or submitted, for any

other degree or diploma at a university or other institution.

4. I have acknowledged all main sources of help.

Supervisor’s Full Name & Signature:

___________________________________________
Ms. Fabiha Enam
Senior Lecturer, BRAC Business School
BRAC University

Student’s Full Name & Signature:

___________________________________________
Iffat Rubaiyat
Student ID: 15104189

ii
Letter of Transmittal

Ms. Fabiha Enam

Senior Lecturer

BRAC Business School

BRAC University

66 Mohakhali, Dhaka-1212

Subject: Submission of Internship Report on Risk Assessment of Products in bKash.

Respected Madam,

It gives me immense pleasure to submit the report of my internship in bKash Limited

for the completion of honors offered by BRAC Business School.

I express my gratitude to you for providing me with the supervision and support to

continue my internship in bKash Limited. Despite various shortcomings, I have been

devoted to find out the core information from different aspects. I hereby, thank you

for your valuable time and guidance.

Sincerely yours,

_______________________

Iffat Rubaiyat

Student ID: 15104189

BRAC Business School

BRAC University

Date: 25th August, 2019

iii
Non-Disclosure Agreement

This page is for Non-Disclosure Agreement between the Company; bKash Limited

and The Student; Iffat Rubaiyat

This agreement is made and entered into by and between bKash Limited and the

undersigned student at BRAC University…………………………………….

iv
Acknowledgement

Firstly, I would like to show my gratitude towards my Almighty for keeping me in

good health throughout my internship tenure and enabling me to complete the

internship report on time, an internship program is a mandatory requirement in order

to pursue the Bachelor of Business Administration Degree, completing the course

“BUS400” of BRAC University. I couldn’t be able to complete the report properly

without the guidance and proper instructions of the people of my academic area as

well as, the people of my job environment.

I am very thankful to my internship supervisor and honorable faculty of BRAC

University, Ms. Fabiha Enam for providing me the guideline to write my internship

report and complete my last report of my undergraduate life. I am really grateful to

her for being available and supportive to me all the time during my internship period.

I would also like to thank Mr. Saber Sharif, head of AML and CFT department, for

selecting me as an intern of his department and I would also like to show my cordial

gratitude to Mr. Hisham Uzzaman Choudhury, General Manager, of bKash Limited

for providing me the opportunity to work in his department. Moreover, I got an

amazing team to work with.

Hereafter, I would like to thank my onsite supervisor Mr. Shahrear Ahamed, Assistant

Manager, for helping me in every possible way. Without his guidance in every step, it

would be impossible for me to write the report. Last but not least, I would like to

thank, all the employees of the department for their help towards me.

v
Executive Summary

Internship is the opportunity to experience the practical work environment. The main

objective of this report is to evaluate the effectiveness of Compliance process

monitoring and control team.

First of all, the report gives an overview of bKash Limited. Hereafter, it draws

attention towards the practices of AML and CFT in Bangladesh and also helps to

identify the importance of the process for any organization. In the third part, the risk

assessment of the products in bkash has been described in detail. Before that, a

comparative study has been shown about the products of bKash. Last but not least, a

little description of the products is written. Moreover, there is a brief description of

KYC checking is given so that the first step of risk mitigation can be shown. At the

very end, recommendations have been stated as per practical knowledge and

evaluating the process.

Here, the comparative researches are shown so the mobile financial services can be

compared.

The report is prepared to evaluate the effectiveness and areas of further development

of risk assessment of products.

Furthermore, here is a small description of the latest product eKYC is given which is

going to launch on 1st September,2019.

Keywords: AML and CFT; Mobile Financial Service; CPMCT; Risk assessment.

vi
Table of Contents

Declaration................................................................................................................................ii

Letter of Transmittal ............................................................................................................. iii

Non-Disclosure Agreement .................................................................................................... iv

Acknowledgement .................................................................................................................... v

Executive Summary ................................................................................................................ vi

Table of Contents ...................................................................................................................vii

List of Figures..........................................................................................................................ix

List of Tables ..........................................................................................................................vii

List of Acronyms ..................................................................................................................... xi

Glossary ..................................................................................................................................xii

Chapter 1 Introduction.......................................................................................................... 13

1.1 Company Profile................................................................................................ 13

1.2 Objective ........................................................................................................... 15

1.3 Mission.............................................................................................................. 16

1.4 Methodology ..................................................................................................... 16

Chapter 2 The Organization ................................................................................................. 17

2.1 Corporate Divisions ........................................................................................... 17

2.2 The teams And Their Functions ......................................................................... 19

Chapter 3 Industry Analysis ................................................................................................. 21

3.1 Comparative Analysis ........................................................................................ 21

vii
 3.2 Competetive Analysis ........................................................................................ 21

3.3 MFS Industry .................................................................................................... 26

3.4 Comparison of Products..................................................................................... 29

3.5 Comparison Between Products of Different MFS .............................................. 32

Chapter 4 Risk Assessment of Products ............................................................................. 35

4.1 Product Lines and Services ................................................................................ 35

4.2 eKYC Launch.................................................................................................... 37

4.3 Risk Assessment of Products ............................................................................. 39

Chapter 5 CPMCT ................................................................................................................ 41

5.1 Job Responsibilities ........................................................................................... 41

Chapter 6 Conclusion ............................................................................................................ 48

References ............................................................................................................................... 49

viii
List of Figures

Figure 1: Corporate Division and Departments ........................................................ 17

Figure 2: Elaboration of ECAD ............................................................................... 19

Figure 3: Stage at the Life cycle of MFS Industry in Bangladesh ............................. 27

Figure 4: Products of bKash .................................................................................... 35

Figure 5: Personal KYC form .................................................................................. 42

ix
List of Tables

Table 1: Teams and Functions ................................................................................. 19

Table 2: SWOT Analysis ......................................................................................... 22

Table 3: Comparison of Products ............................................................................. 29

Table 4: Comparison between Products ................................................................... 32

Table 5: Observation for KYCs ............................................................................... 44

x
List of Acronyms

MFS Mobile Financial Service

KYC Know Your Customer

BFIU Bangladesh Financial Intelligence Unit

Anti-money laundering/countering the financing

AML/CFT
of terrorism

Chief Anti-Money Laundering Compliance

CAMLCO
Officer

MNO Multi-national Organization

CDD Customer Due Diligence

NBR National Board of Revenue

IFC International Finance Corporation

ML/TF Money laundering/terrorism financing

EC Election Commission

eKYC Electronic-know-your-customer

xi
Glossary

KYC The main form of bKash to open an

account.

eKYC The new electronic KYC by which

customers can open their account

themselves.

xii
Chapter 1: Introduction

1.1 Company Profile

In 2011, bKash started its journey along with 12 employees. Moreover, in a very short period

of time bKash has become the leading MFS (Mobile Financial service) of Bangladesh. The

impact bKash has created to rural and urban people are life changing. Its mission is to reach

to all the unbanked people by offering the financial services at the lowest possible cost and

through mobile network. It already has a huge customer base and is the market leader. But,

like all financial service provider bKash has been facing fraudulent activities and to mitigate

these risks the Division of External & Corporate Affairs is working day and night. As per

Bangladesh Bank rule and regulation MFS providers must follow guidelines and policies

which include the CDD which is the Customer Due Diligence. bKash application is basically

act as depository of electronic money while the transaction is being done through customer’s

cell phone. But this platform is being misused by some criminal minded people who are

basically corrupted and has no moral values. Every minute a lot of customers are using this

application and becoming victims of serious criminal offence like money laundering and

terrorist financing. For some reasons day by day ML&TF activities are increasing at an

alarming rate which can be potential threat for bKash application. I got the opportunity to

work under the team where I got to do the CDD of personal bKash account holders. There are

certain guidelines by BFIU by which we accept or reject registered KYCs which was my

main job responsibility. KYC is fulfilled to complete a registration and according to BFIU

guidelines there are some mandatory fields which must be filled properly to maintain a

certain quality of the registration.

Mobile Financial Services (MFS) is an approach to offering financial services that combines

banking with mobile wireless networks which enables users to execute banking transactions.
13
This means the ability to make deposits, withdraw, and to send or receive funds from a

mobile account. Often these services are enabled by using bank agents that allow mobile

account holders to transact at independent agent locations outside of bank branches.

In 2011 BRAC Bank launched a 51% owned subsidiary called bKash combined with an

investment from Money in Motion an USA based company granted permission by

Bangladesh bank to jointly operate MFS in Bangladesh. In April 2013, International Finance

Corporation (IFC), member of the World Bank Group, became an equity partner and in April

2014, Bill & Melinda Gates Foundation became the investor of the company. In 2017, bKash

Limited, the largest mobile financial service provider in Bangladesh was ranked 23rd on

Fortune’s third annual ‘Change the World’ list which recognizes top fifty companies that are

changing the world through solving a multitude of societal problems(bKash, 2017).

bKash provides one service menu for MNOs which includes Robi, Banglalink,

Grameenphone and Airtel. bKash is the largest MFS in Bangladesh with a network of over

200000 agents scattered through the urban and rural areas of Bangladesh touching the

unbanked communities with over 35 million registered accounts. bKash has also collaborated

with big organizations as business partners such as Aarong, Bata, Lotto etc. which are known

as merchants.

Bangladesh Bank plays a huge role in shaping the regulations of bKash’s operations. bKash

follows compliances and amendments so that no fraudulent activities can take place using the

services provided by bKash. bKash maintains the requirements of Bangladesh Bank and most

importantly bKash does Customer Due Diligence (CDD) or Know Your Customer (KYC) for

background check to ensure the customers are properly risk assessed before being on boarded

also provides training sessions to stakeholders to have the required knowledge(International

Compliance Association, n.d.).

14
 By providing various banking services such as cash in/out, buying airtime, making

payments, sending money and remittances through mobile networks bKash has

already reached to almost

every district of Bangladesh and has provided affordable banking services to people

who could not afford banking services and is contributing a large portion to the

country’s growing economy.

1.2 Objectives

In Recent days mobile financing industry become very much comprehensive. It deals

with different areas to capture the market & it requires huge promotional activities to

survive. Beside this it takes huge effort to known this system with general people.

Moreover, they have to come up with different innovative ideas to have a position in

the market. Thus, the study covers a broad spectrum such as Service, price,

promotion, government, regulation etc. Based on the above facts the specific

objectives of the study follow:

 To give an overview of Mobile financing industry in Bangladesh

 To find out about the future prospects in the industry.

 To evaluate the performance of bKash.

 To evaluate the competitiveness of bKash in the market.

 To get an insight of the products of bKash.

15
1.3 Mission:

Being the largest MFS in Bangladesh, the objective of bKash is to provide convenient,

affordable and reliable financial services. The company aims to widen the net of financial

inclusion and provide a solution for Mobile Financial Service built on a highly scalable

mobile money platform, allowing the people to do safe money transactions through mobile

devices (bKash, n.d.).

1.4 Methodology

For making a report, correct information and data are needed. Moreover, this report mostly

comprises of primary and secondary data.

Primary Data:

This data is directly collected from the source that is from the company directly. Here,

the interns can gather information by asking the employees and also can add their

knowledge which they gathered during the internship duration.

Secondary Data:

For further information and data collection secondary data collection is done by

collecting data from internet, previous research’s and going through company

documents.

16
Chapter 2 The organization

2.1 Corporate Divisions:

bKash has several divisions which are divided into into different departments to carry out

functions. The departments are then divided into several teams working together as a whole

for the department. The divisions of bKash are shown below:

Commercial

Marketing

Finance
AML & CFT

Technology
Regulatory &
bKash

Corporate Affairs
ECAD

External Affairs
Human Resource
Admin
Corporate
Government & Legal

Internal Audit

Customer Service

Figure 1: Corporate Division and Departments

17
An an intern in the External & Corporate Affairs Division (ECAD) which is one of the largest

divisions of bKash with four departments divided into several teams is a great opportunity.

ECAD mostly works with compliance, fraudulent activities and works to mitigate risks

associated with bKash and it’s operations. ECAD division of bKash harmonizes the interests

of bKash with the regulations of Bangladesh Bank required for MFS provider related to

mitigate risk of money laundering and financing of terrorism. Bangladesh Financial

Intelligence Unit (BFIU) provides the compliance and amendments related to risk mitigation

for bKash. ECAD deals with the external affairs related to bKash. As an intern in the Anti

Money Laundering & Combating Financing of Terrorism (AML & CFT) department and got

to work with the CPMCT. CPMCT is Compliance process monitoring and control team.

18
2.2 The Teams &Their Functions:

CPMCT
External & Corporate Affairs

RMCT

Regulatory Affairs
Division (ECAD)

SCT

STR/SAR
Anti Money Laundering &
Combating Financing of Terrorism
Training team

External Affairs CA&D

FCAT
Regulatory &
Corporate Affairs
RAMLCO

Figure 2: Teams

Compliance Process Monitoring & Control Team (CPMCT):

This team works with customer services, rechecks their works, gives feedbacks and develops

strategies for further scopes of improvement in accordance with compliance.

Risk Monitoring & Control Team (RMCT):

This team monitors situations, identify risks that can arise using bKash services and provide

measures to mitigate those risks.

Strategic Compliance Team (SCT):

This team analyses the provisional risks that might arise after implementing new strategies and finds

out ways to overcome those risks.

19
Suspicious Transaction Report/ Suspicious Activity Report Team (STR/SAR):

This team reports unusual activities and transactions using bKash services then raises complaints and

takes actions accordingly.

Training team:

This team trains agents, distributors and merchants according to the requirements of Bangladesh

Financial Intelligence Unit (BFIU)

Compliance Analysis & Documentation (CA&D):

This team keeps all the documents and records of the entire department and directly works with

Bangladesh Bank.

Field Compliance Assessment Team (FCAT):

This team works directly in the field, assess problems of unusual transactions directly through the

primary sources.

Regional Anti-Money Laundering Compliance Officer (RAMLCO):

They are the heads of individual division in different regions who follows up regional problems

arising through bKash services.

Table 1: Teams and Functions

20
Chapter 3 Industry Analysis:

3.1 Comparative Analysis of bKash Limited

bKash Limited is a joint venture between BRAC BANK Limited, Bangladesh, and Money in

Motion LLC, USA. The ultimate objective of bKash is to ensure access to a broader range of

financial services for the people of Bangladesh. It has a special focus to serve the low-income

masses of the country to achieve broader financial inclusion by providing services that are

convenient, affordable and reliable. (bKash, 2013)

The report is containing a comparison between bkash and DBBL Mobile Banking in terms of

their branding. There the comparison based on visibility level, area covered by the company

and other branding issue.

The report also portrays the industry through Porters’ Five forces model. The state of the

industry is best portrayed through the model. The threat of new entrants is low due to the

shortage in spectrum and bargaining power of suppliers is also low.

If one studies the comparative analysis of the market, it can be seen that bkash has already

built brand equity among its customer. Thus far, it has been able to hold on to its leadership

without doing much.

3.2 Competitive Analysis of Top Four MFS Operators

SWOT Analysis: SWOT analysis is a framework used to evaluate a company's competitive position

and to develop strategic planning. SWOT stands for strengths, weaknesses, opportunities and threats.

SWOT analysis assesses internal and external factors, as well as current and future potential. (SWOT

Analysis - Investopedia, 2019)

21
3.2.1 Strength

1. Market leader

2. Agents in every corner of Bangladesh.

3. Strong investors backup

bKash

4. Strong departments for maintaining compliance & regulatory policy

5. Strong brand image

6. Strong company culture

1. Strong agent banking structure

2. Country’s best and largest ATM network

Rocket

3. Low account operation cost

4. Strong banking backup from the parent bank

1. A fixed amount of loyal military customer

2. Parent bank emphasize on market share

t-cash

3. Have the ability to gain peoples trust

4. Daily interest on saving

1. Offers a limited amount of services

UCash
2. Receives full cooperation from parent bank

3. Made a contract with BRTA for receiving all sort of road tax

22
3.2.2 Weakness

1. High service charge compared to other MFS operators

2. Holding back in terms of differentiating itself from competitors

bKash

3. Most of the rumors of the industry are bKash focused

4. Least security measures for field agents

1. Failed to operate as an individual like bKash

2. Bound to compliances of the parent bank

3. Does not have dedicated divisional operation

Rocket
4. More of a complementary unit

5. Low percentage of market share

6. Weak customer engagement

7. Less loyal customers

1. Very low market share

t-cash 2. Was not able to reach local customers

3. Weak customer engagement

4. Less scope of international exposure

1. No interest on savings
UCash
2. Very low market share

3. Not so popular among local people

23
3.2.3 Opportunities

bKash 1. A huge array of potential customers

2. bKash is connected with popular online shops

3. Since it has a magnificent portfolio of international investors, it can expand its

business globally

4. Continuously discovering product line

Rocket 1. Comparatively better position and a prospect to flourish in services

2. Helping parent bank in converting 90% mobile users to core banking customer

3. Potential growth of the industry and more focused operation from the authority

t-cash 1. Chances of gaining customers are high

2. New ideas can be implemented

3. Have the ability to utilize trust banks conventional customers to increase market

share

UCash 1. No of customers are growing in a very fast rate

2. Ability to make deals to receive different types of government fees and taxes

3. Gradually receiving popularity among both rural and urban people.

24
3.2.4 Threats

1. Getting abused by fraudsters and criminals

bKash
2. The gap with the nearest competitors is decreasing

3. The entrance of government organization (NAGAD) into the Industry with

better service offers.

1. An increasing number of inactive accounts

Rocket 2. The possibility of losing existing market share if bKash offers even better

services with the help of newly aligned Alipay

3. The government initiated “NAGAD” can be a potential threat to the existing

market shares.

1. Nagad can become a huge threat.

t-cash
2. Can lose existing market share.

3. Low ability to market is a threat.

1. Small number of services offered is becoming a problem for UCash

UCash
2. Lack of creative ideas is making its customers exhausted

3. bKash and rocket are acquiring its potential customers

Table 2: SWOT Analysis

25
3.3 MFS Industry Analysis:

The mobile wallet market in Bangladesh is likely to gain momentum in 2019 as a global

report forecasts its growth to USD 250 billion by 2024 from over USD 100 billion in 2017,

according to experts. Mobile Financial Service (MFS) experts said the size of the mobile

wallet market was expected to increase at a 30 per cent compound annual growth rate

(CAGR), while it is 15 per cent around the globe. 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. (Bhutani & Wadhwani, 2019)

US-based Global Market Insights, in its report released on Tuesday, 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 report says significant capital investments by major industry

players towards redevelopment programs as well as collaboration among fintech firms and

commercial banks will further stimulate the industry growth. (Bhutani & Wadhwani, 2019)

“Cashback offers also reduce the customer acquisition cost by preventing companies from

spending large amounts on marketing their products,” the report says, noting that countries

like Bangladesh and India will also see further growth in the mobile wallet market in 2019.

Countries like India, Bangladesh and Kenya will also see impressive growth in the mobile

wallet market in the days ahead, the report says. (Azad, 2019)

Commenting on the report, a Bangladesh Bank (BB) official said the Bangladesh MFS

market would gain momentum in 2019 as most players are offering lucrative discounts and

26
cashback offers and likely to introduce lucrative services in cooperation with global players.

(Azad, 2019)

Figure 3: Stage at the Life cycle of MFS Industry in Bangladesh

27
More than 50 million people are using mobile financial services offered by 18 banks to meet

their needs under a regulatory environment. The industry has experienced 120 per cent

growth since 2011 thanks to rapid customer’s adoption and innovations in services offered.

"bKash, a multinational company is a leading MFS player in Bangladesh with a lion’s share

of the market, followed by Rocket and Sure Cash”, said the central bank official. It is

expanding its customer base with lucrative cash back offers. bKash has already adopted QR

code in its payment apps to facilitate customer’s cashless shopping experiences, the BB

official said, adding that government offices are increasingly accepting this new mode of

payment, while different private sector companies have been using this platform for salary

disbursement.

According to BB’s report on MFS, the total volume of transactions conducted through MFS

platform was Tk. 378,885 in 2018, which is 20 per cent higher than 2017. Moreover, the

number of active customers has also increased to 3.73 in 2018 from 2.1 crore in 2017.

Shamsuddin Haider Dalim, head of corporate communications of bKash, said the wallet-to-

wallet fund transfer is still the most popular segment in MFS transactions. He also said there

is tremendous growth potential in some other segments too, including bill payment, merchant

payment, salary disbursement and international remittances. “We have seen a strong impact

on our remittance solutions where our partner banks like MTBL, Bank Asia, City Bank and

BRAC Bank are bringing foreign remittances.” (Azad, 2019)

28
3.4 Comparison of Product & Services Offered and Fees charged

by the Top Four MFS Providers of Bangladesh

Services bKash Rocket t-cash UCash

Offered
Availabili Fees Availabili Fees Availabili Fees Availabili Fees

ty ty ty ty

A/C Yes Free Yes Free Yes Free Yes Free

Opening

Cash in at Yes Free Yes 0.9% Yes Free Yes Free

Agent for

salary

or

stipend

produc

ts

Cash in at N/A N/A Yes 10 taka Yes Unknow N/A N/A

Bank for n

Branch salary

or

stipend

produc

ts

Cash in Yes Free N/A N/A N/A N/A N/A N/A

from Bank

A/C

29
Cash Out Yes 1.85 Yes 0.9 to Yes 1.85% Yes 1.85%

from an % 1.8%

agent

Cash Out Yes 2% Yes 1.80% N/A N/A N/A N/A

from ATMs (Minimu

m 2000

taka)

Cash Out N/A N/A Yes 1.80% N/A N/A N/A N/A

from Bank

Branches

P2P Yes Tk 5 Yes Tk 5 Yes Tk 5 Yes Tk 5

Transfer

Interest on Yes 1.5% N/A N/A N/A N/A Yes 2%

Savings to

4%

Bill & Yes Free Yes Free Yes Unknow N/A N/A

Merchant n

Payment

Merchant Yes 1.30 Yes 1% Unknown Unknow N/A N/A

% n

Payment to

(cost to 1.8%

merchant)

B2P Yes 0.05 Yes Free Yes Unknow N/A N/A

30
Disburseme % n

nt

Collection Yes 1.50 Yes 1.50% Yes Unknow N/A N/A

Settlement % n

Fee

Minimum No N/A Yes 20 Tk Unknown Unknow Unknown Unknow

Balance n n

Requiremen

Mobile Yes Free Yes Free Yes Free N/A N/A

Recharge

Table 3: Comparison of Products

After analyzing all the products and services offered by the different MFS operators,

it is very clear that bKash and Rocket provides the most premium services among

all other MFS operators. Their services are almost similar to each other, in terms of

cash in from bank branches Rocket has got an edge over bKash, on the other hand

cash in from bank account is only provided by bKash, which gives bKash an edge

over all other operators. The highest amount of interest on savings up to 4% is

provided by bKash to its customers & there is no minimum balance requirement for

bkash account holders. All these extra advantages given by bKash make it more

preferable to general customers.

31
3.5 Comparison between products and services offered by the

top three MFS operators:

Services Offered
M-Pesa bKash MTN

Momo

A/C Opening Yes Yes Yes

Cash in at Agent Yes Yes Yes

Cash in at Bank Branch N/A Yes N/A

Cash in from Bank A/C Yes Yes N/A

Cash Out from an Agent Yes Yes Yes

Cash Out from ATMs Yes Yes N/A

Cash Out from Bank

N/A N/A N/A
Branches

P2P Transfer
Yes Yes Yes

P2P Transfer (Different

Yes N/A Yes
Operators)

P2P Transfer to
Yes N/A N/A
Unregistered Users

32
 Interest on Savings
Yes Yes Yes

Specialized Savings
Yes No Yes
Account

Providing Loan
Yes N/A Yes

Bill & Merchant

Yes Yes Yes
Payment

B2P
Yes Yes Yes
Disbursement

Minimum Balance
No No No
Requirement

Mobile Recharge
Yes Yes Yes

Leasing Services
Yes No Yes

Life Insurance Services

No No Yes

Remittance Services
Yes Yes Yes

Payment Gateway
Yes Yes Yes

Table 4: Comparison between Products

It can be seen there are some major differences between products & services offered by bKash and

the other two top MFS providers.

33
The first major difference between bKash and other two MFS is, bKash is a

subsidiary of a bank, whereas M-Pesa & MTN MoMo both are a specialized service

provided by two of the world’s largest mobile operator company. M-Pesa is owned

by Safaricom and MTN MoMo is owned by MTN Group.

Though M-Pesa and MTN MoMo are owned by two mobile network operators but

they are providing complete banking services to their customers compared to bKash.

M-Pesa and MTN MoMo customers can take loan, deposit their money through a

specialized saving scheme, even they can receive or disburse lease payments using

mobile money account. bKash customer does not receive such services. M-Pesa is

providing life insurance services to their customers. bKash need to adopt those

services to increase financial inclusion in Bangladesh.

M-Pesa and MTN MoMo provide some services which should be provided by every

MFS operator in our country to increase financial inclusion. They are P2P transfer

to different operators and P2P transfer to unregistered users. This advantage will

make MFS services even more convenient to common users.

34
Chapter 4 Products and Their Risk Assessment:

4.1 Product lines or services:

Cash In
Request
Cash Out
Money

Movie Send
Tickets Money

bKash
Products
Card to
Payment
bKash

Bank to
Remittance
bKash

Bills Air time

Figure 4: Products of bKash

35
Descriptions:

 Cash in: Users can load e-money into their bKash accounts from bKash agents or

ATMs. This does not cost any charge; the user gives money to agent or transfers from

ATMs it automatically loads e-money into their bKash account.

 Cash out: Users can withdraw money from their bKash account or ATMs. They can

only withdraw the amount they have in their account and requires certain charge in

every withdrawal.

 Buy airtime: bKash account users can directly buy airtime using any Mobile

Network Operator using e-money from their account.

 Payment: bKash account users can also make payments in collaborated stores known

as merchants through ‘bKash Payments’.

 Send Money: One bKash account user can transfer e-money to another bKash

account using ‘Send Money’ option.

 Remittance: bKash has strategic alliance with Western Union and MasterCard to

enable transfer of foreign remittance through bKash accounts which is available 24/7

and people can send money from 200 countries to Bangladesh which makes this

service convenient for users to receive remittances.

 Bank Transfer: bKash account holders can transfer money from their bank accounts.

 Request Money: A bKash account holder can request another account holder for

some money in emergency.

 Bills: bKash app can also be used as a bill payer for electricity.

 Bank to bKash: By this, customer can transfer money from bank to a bKash app.

 Card to bKash: In this cashless tendency society people tempt to carry credit cards

more than cash. So, bKash app allows to transfer money from cards.

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  eKYC: A new feature for the app so that customers can open their own accounts by

themselves only by scanning their NID and clicking a photo. For now, only the agents

have the access but from 1st September, 2019 each and every customer will get the

opportunity for this.

4.2 eKYC Launch

This year bKash launched e-KYC (Electronic-Know-Your-Customer) app for the individual

customers so that one can open their own account by using their own mobile bKash app. As

bKash App is most popular and have maximum user became the first mobile financial service

provider who came up with this idea.

According to the press release by bKash they announced that, the eKYC app allows customer

to open their accounts by instant activation by scanning NID and taking a photo.

OCR (Optical Character Recognition) is to collect data from NID, face detection technology

and cross matching data with Election Commission (EC) database, the app is making the

whole system more integrated and less operational complexity. Furthermore, it saves more

time.

An automated scanning process OCR helps to extract information from the NID and filled the

eKYC form.

Then a photo is taken directly by the mobile phone and all the information are cross matched

with EC database.

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After proper verification, the system will automatically register the customer account and

send confirmation message to both the eKYC app user and the new customer.

At this moment, agents, bKash care, bKash center and distributors are registering new

customers using this interactive app.

But, bKash plans to render this solution directly to the customers so that they can open

accounts by themselves.

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4.3 Risk Assessment of The Products:

Risk Definitions

1. Systemic: A risk that could cause collapse of, or significant damage to, the

financial system or a risk which results in adverse public perception, possibly

leading to lack of confidence and worst-case scenario, a "run" on the system

2. Operational: A risk which damages the ability of one of the stakeholders to

effectively operate their business or a risk which results in a direct or indirect

loss from failed internal processes, people, systems or external events

3. Reputation: A risk that damages the image of one of the stakeholders, the

mobile system, the financial system, or of a specific product

4. Legal: A risk which could result in unforeseeable lawsuits, judgment or

contracts that could disrupt or affect MFS business practices

5. Liquidity: A risk that lessens the ability of a bank or MFS provider/agent to

meet cash obligations upon demand

6. International: A systemic risk (as defined above) that could have cross-border

contagion effect

bKash is a mobile financial service, so its services are its products. Moreover, there may be

risks associated with the new products.

Other products are giving service for about 2-3 years but for now the main concern is eKYC

app. For this reason, there are some thresholds that for avoiding the risks.

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Previously its known that eKYC app is a self-controlled app by which customers can open

their own accounts. But then again, the customers can be a fraud, he/she might want to open

multiple accounts, can use a death customers NID or number and also there are some more

problems. Moreover, as the app is not launched yet for every customer it is not allowed to

include all the thresholds.

To avoid opening multiple accounts bKash has set the rule, one NID one account.

Furthermore, for avoiding risks for death persons' account while taking the picture for eKYC

the customer has to blink his/her eyes.

4.4 The risk assessment processes bKash mostly follows:

 Pre and Post Transaction monitoring

The main service or products of bKash is to transact money. Moreover, all the

transactions are being monitored by bKash as it is a sensitive issue.

 Product as per the Regulatory guidelines

There are some regulatory guidelines that are settled by BFIU which bKash follows

only to avoid risks.

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Chapter 5: CPMCT

5.1 Job Responsibilities:

As an intern the scope of working and access to work was limited. In the past three months of

internship in bKash has been an amazing experience and a journey of learning. Through the

internship period one could step into the corporate world where they did not just learn about

the work environment and behavior but they could also enhance their skills. Intern had to

work in MS Excel where all developed Excel skills.Interns got the chance to go through

BFIU circulars where everyone got to know about the rule, regulations and policies.

Furthermore, Intern were given the responsibility to monitor, detect and give observations on

the registered forms of personal customer account. They had to check the quality of KYC

forms according to certain guildelines by BFIU for mobile financial service providers and

whether if the criterions were met.

For opening a personal account, the account holder has to be physically present in an agent

point with their NID/ Driving license/ Passport as a photo proof and needs to fill up the KYC

designed for personal account. The KYC form fro personal account is given below:

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Figure 5: Personal KYC Form

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To check if the KYC is compliance effective or not BFIU has provided some

guidelines. The guidelines by BFIU to recheck the KYCs are as follows:

 The photo submitted with the KYC must match with the photo ID

 NID/provisional NID/paper printed NID/smart card will be accepted asphoto ID.

 Use of Fluid anywhere in the KYC will automatically be the cause of rejection

 Usage of multiple languages is not allowed. KYC has to be either in English or

Bangla. Numeric fields must be filled in one language only.

 The applicant must provide a signature in the photo copy of the photo ID given and

the signature given in the KYC must match the sign in the supporting document.

 No overwriting or corrections are allowed in the KYC, however, upto four corrections

are allowed but the customer has to provide a counter signature for each correction. If

the number of corrections exceeds four the KYC will be rejected. Any sort of

correction in the customer’s wallet number will lead to direct rejection of the KYC.

 In terms of various appearance deviation like age, gender etc will lead to KYC

rejection. Anyone having beard or transparent glasses is acceptable. If someone is

blind he/she can wear dark glasses but he needs to provide a certified document.

 Front faced photos are accepted only. Picture with single colored background or shade

is accepted.

 The date field must be filled and absence of date in the KYC will be rejected.

 Date of Birth (D.O.B) has to match the photo ID provided and can be written in both

numeric and Alpha- numeric form.

 In Address field, four sub-fields (Village/area, Thana/upazila, District/city &Postal

code) must be filled out in both permanent and present address fields.

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  Details of occupation must be filled out. Source of funds, Monthly income must be

stated properly unappropriate sources would lead to KYC rejection.

 Only one gender option should be selected

 Signature of agent and distributor with date is a must, thumb print will cause

rejection. Seal is not mandatory.

 Any customer account number with less/more than 11 digits including zero should not

be accepted and cause KYC rejection.

 Any supporting document used as Photo ID must have validity date wherever

applicable.

 Personal accounts can also be opened by armed license, military, para military, SAGs

and LEAs, freedom fighter ID, office ID (Government/semi Government), Student ID

and NGO beneficiary ID but birth certificate must be given along with it.

Internsare to recheck the KYCs which were accepted by Customer Service and if the

forms were compliance effective they have to accept the sampled KYCs but if any

error foundhave to reject those KYCs and give certain observations with remarks and

give input in MS Excel. Some observations and reasons for those observations are

given below:

Observations Reasons Remarks

The photo ID submitted with the KYC must be Quality Check

Unclear Photo ID clear, readable and visible, if not, we give this (QC) Not

observation possible

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 If the photo given with the KYC has different

Incorrect Photo coloured background or the front face of the KYC is Rejected

person is not visible we give this information

If the photo of the account holder doesnot match

Photo Mismatch KYC is Rejected
with the photo ID we give this observation

Father’s/ Mother’s Name Father’s/ mother’s name has to match with photo
KYC is rejected
Missing ID, if not we give this observation

Spouse name has to match with the photo ID, if

Husband/ Wife’s name missing KYC is Rejected
not, we give this observation

D.O.B has to match with photo ID, if not we give

Wrong D.O.B KYC is Rejected
this observation

The applicant’s name must match with the name

Name Mismatch KYC is Rejected
given in Photo ID, if not we give this observation

If signature does not match with the signature

provided in the supporting document and if the

Signature mismatch/missing KYC is Rejected
applicant does not give signature in KYC, we give

this observation

Signature not found in The applicant must sign the photocopy of the
KYC is Rejected
supporting document photo ID, if not we give this observation

KYC/Supporting document not If KYC is not found or supporting document is

QC Not Possible
found not found we give this observation

If there is no agent signature found in the KYC

Agent Signature not found KYC is Rejected
we give this observation

If NID is given as photo ID the number must

NID number incorrect in KYC KYC is Rejected
match with the NID number if not we give this

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 observation

All the fields of KYC must be filled if not the

Incompleteness of KYC form will be considered incomplete and we give KYC is Rejected

this as an observation

The customer sign cannot match with the

Customer and Agent sign same applicant’s sign because the agent cannot open a KYC is Rejected

personal account with same number

Different supporting The photo ID information must match with the KYC is

document KYC, if not we give this observation Rejected

The date of registration must be given if not we KYC is

Datemissing/ mismatch
give this observation Rejected

All the mandatory fields must be filled if not KYC is

Mandatory field missing
we give this observation Rejected

Four correction is allowed if exeeds four it will

KYC is
Overwriting be considered as over writing and any
Rejected
correction in the wallet number is over writing

Four corrections are allowed but the applicant

KYC is
Counter signature not found must give a counter signature if not found we
Rejected
give this obsevation

Address not captured/ filled Four fields of address must be filled or else we KYC is

up properly give this observation Rejected

Validity date Any photo ID provided that has validity date KYC is

missing/mismatch must match or stated in the KYC if not we give Rejected

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 this observation

No use of fluid is accepted anywhere in the KYC is

Fluid use in KYC
KYC Rejected

Agent number must be given but if the KYC is KYC is

Agent Number not found
for an update it is accepted Rejected

Table 5: Observations for KYCs

Interns either reject the KYCs checked by CS with these observations or if all the

fields are correctly filled we accept those KYCs. In case the information required are

not filled properly bKash gives sixty days time to fix the problems orelse their wallets

are freezed. By this process we work as a control body over the CS to maintain the

qualities of the registered KYCs.

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Chapter 6 Conclusion:

6.1 Conclusion:

Risk assessment is one of the most important practices for any mobile financial service. By

this the products can be saved and the risks can be mitigated. Moreover, customers will be

highly satisfied and recommend the service to others.

Furthermore, bKash have a huge customer base and to keep track of them a team work on the

fields to train the agents and a team monitor them from head office.

In addition to that, the product team always try to make their products flawless and user

friendly. Most importantly, each and every time they give their heart and soul to innovate

more to focus for creating a cashless society.

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References:

[1] (2016, March 10). Comparative Analysis of bKash Limited. Retrieved from

https://www.assignmentpoint.com/business/management/comparative-analysis-of-bkash-

limited.html

[2] Mohammadruhulkader. (2018, December 1). The MFS Service Charge Question, bKash and

Remittance Conundrum. Retrieved from https://futurestartup.com/2018/12/02/the-mfs-service-

charge-question-bkash-and-remittance-conundrum/

[3] (2019, August 8). bKash launches eKYC app for AC opening. Retrieved from

https://www.dhakatribune.com/business/2019/08/09/bkash-launches-ekyc-app-for-ac-opening

[4] (2019, July 28). BKash. Retrieved from https://en.wikipedia.org/wiki/BKash

[5] Kaler Kantho. (n.d.). bKash launches eKYC for digitally opening account. Retrieved from

https://english.kalerkantho.com/online/tech/2019/08/08/25883

[6] (2019, July 7). Digital Financial Services – The Next Step. Retrieved from

https://www.lightcastlebd.com/insights/2019/01/15/digital-financial-services-the-next-step

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