Karachi, Branchless Banking (BB) continued to show rising trend in third quarter (January- March 2012) of current fiscal year (2011-12) during which BB transactions surged by 23% to 25.3 million as compared with 20.6 million in preceding quarter. Value of these transactions was recorded at Rs 85.092 billion, showing 7% growth as compared with Rs 79.410 billion in quarter ended on December 31, 2011.
State Bank of Pakistan SBP’s Branchless Banking Newsletter, says average daily BB transactions increased to 280,798 in third quarter showing 23% growth as compared to 228,858 transactions in previous quarter. BB deposits grew by 18% to Rs 594 million in Jan-March 2012 quarter as compared with Rs 503 million in preceding quarter.
Total number of Branchless Banking agents increased by 19% to 26,792 in January-March FY12 quarter as compared with 22,512 in quarter ended on December 31, 2011. Similarly, total number of BB accounts surged by 14% to surpass one million mark (1,059,519) in quarter under-review as compared with 929,184 in previous quarter.
BB agents now have footprint in 89% of total districts in Pakistan out of which 52% have more than 90 agents which are mainly located in low income urban or rural communities. Number of registered m-wallet accounts (a popular Branchless Banking service in which cash value is stored on mobile phone of a customer; this can be used to deposit, withdrawal, and money transfer through mobile phone) reached to 1.03 million at end of quarter under review in which number of active m-wallets is about 53%. About 5,573 debit cards have also been provided to mobile account holders, indicating efforts to create value proposition in m-wallets.
Bills payment remained dominating activity of Branchless Banking with 42% share in total transaction volume, followed by person to person (over the counter) fund transfers and airtime top-ups with share of 32% and 10% respectively. BB service providers are trying to increase their linkages with microfinance institutions as loan repayments of Rs.312 million were collected through BB agents during quarter under review.
Growth expectation in BB is fairly high as largest brand of the country is in process of technology up-gradation for account opening, forth which it will start registration of customers for Level Zero Account (per month transactions limit Rs 25,000), which will bring low income segment of society into financial services loop. Moreover, few other banks are also likely to start their BB operations soon.
SBP established Consultative Group on Branchless Banking to foster market development under chairmanship of Muhammad Ashraf Khan, Executive Director, Development Finance Group of SBP. It comprised key stakeholders – Pakistan Telecommunication Authority, National Database & Registration Authority, banks, Microfinance banks, Mobile Network Operators, Technology Solution Providers. Group provides common plat-form for branchless banking eco-system developers and opportunity to develop collective policy recommendations on critical issues. BB promotion is integral component of SBP’s financial inclusion strategy which aims to stimulate inclusive growth in the country by reaching out to financially under-served population.