The usage of mobile financial services in Bangladesh

Ehsan, Zaeem-Al and Musleh, Naomi and Gomes, Veronica and Ahmed, Wasiq and Ferdous, Md Dinash (2019): The usage of mobile financial services in Bangladesh.

Abstract

With increasing mobile and internet penetration rates (51% and 56% respectively) and a significant increase in mobile phone and internet usage, the adoption of MFS is increasing too. This paper focuses on the usage of Mobile Financial Services in Bangladesh. For the purpose of the paper, respondents consisted of 198 participants, 129 of which were users. The findings revealed that 46% preferred cash as their method of money transaction with MFS at a second 33%, purpose of usage was mostly to recharge their phones (30.8%) and transferring money (25.8%), with 34.8% of them being non-account holders. The demographic profile of the respondents was 31% female and 69% male, with a mean age of 23.8 and a mean monthly income of BDT 31,400. The most significant factor in the determination of usage was the perception that MFS is easy to use, with other important factors being- convenience, ease of recharge and proximity of agents. While the mean perception of male and female respondents was unequal, perception was not related to age, monthly income, education level or occupation. Taking everything into account, a number of recommendations were suggested which included- offering further features from banks and MFS providers to increase usage, adoption of mobile application interface to ensure smooth customer experience, effective deployment of agents to ensure optimal coverage, promotions and cash-back offers and lastly, ensure reliability and security by limiting transactions per day. To conclude, the overall perception on MFS in Bangladesh is positive however room for improvement still lingers.

• Item Type: MPRA Paper
• Language: English
• Keywords: MFS, Bangladesh, Digitization, Financial markets, Innovation
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O33 - Technological Change: Choices and Consequences ; Diffusion Processes; O - Economic Development, Innovation, Technological Change, and Growth > O5 - Economywide Country Studies > O53 - Asia including Middle East

References

Abdinoor, A., & Mbamba, U. O. L. (2017). Factors influencing consumers’ adoption of mobile financial services in Tanzania. Cogent Business and Management, 04(01). Retrieved from https://www.tandfonline.com/doi/full

Akhtaruzzaman, D., Islam, D., Islam, M., Rubayat-Ul-Islam, P., Bhuiyan, M. R., Tareq, D., and Palas, M. U. (2017), “An Impact Study on Mobile Financial Services (MFSs) in Bangladesh- A Joint Research by Bangladesh Bank and University of Dhaka”, Bangladesh Bank.

Bilodeau, J., Hoffman, W., & Nikkelen, S. (2011). The Mobile Financial Services Development Report 2011. Retrieved from http://reports.weforum.org/mobile-financial-services-development-2011/content/pdf/wef-mfsd-report-2011.pdf.

Srinivas, V., Friedman, S., & Eckenrode, J. (2014). Mobile financial services: Raising the bar on customer engagement. Deloitte Center for Financial Services. Retrieved from https://www2.deloitte.com/content/dam/insights/us/articles/mobile-financial-services

Sultana, R. (2014). Mobile Financial Services (MFS) Business and Regulations: Evolution in South Asian Markets. SRRN Electronic Journal.

Waranpong Boonsiritomachai, K. P. (2017), “Determinants affecting mobile banking adoption by generation Y based on the Unified Theory of Acceptance and Use of Technology Model modified by the Technology Acceptance Model concept”, Kasetsart Journal of Social Sciences, pp. 1-10

Zaman, D. H. (2012). Mobile Financial Services in Bangladesh: An Overview of Market Development. The Bangladesh Bank. Retrieved from https://www.bb.org.bd/pub/research/policypaper/pp072012.pdf