Banking enters new era

Banking enters new era
Bangladesh Bank introduces online payment system
Rejaul Karim Byron and Nafid Imran Ahmed
Hassles are about to be over. Shoppers will no longer have to go to market spending hours in traffic jams. One does not need to stand in long queues to pay utility bills. All are now possible on the internet. Bangladesh Bank yesterday introduced online payment systems facilitating fund transfers and payment of utility bills on the net. The new move allows people to use local currency credit cards for online transactions within the country. Although step toward a full-fledged online banking.This move will certainly enhance the use of e-commerce and online banking services facilitating subscribers of all commercial banks in Bangladesh.The central bank issued a circular to all commercial banks saying subscribers to internet banking will now be able to pay utility bills online from customers' accounts to billing accounts. "This will create a revolution in e-commerce and online banking," said Bangladesh Bank Governor Dr Atiur Rahman. Online fund transfer between two accounts under the same name in the same bank will also be possible. The circular mentioned that e-commerce-based transaction between buyers and sellers can also be done through internet banking. Online transactions by credit card in local currency will also be possible. “This is the first and the most significant step towards electronic transaction in the country,” Munir Hasan, consultant, Access to Information (A2I) project under the Prime Minister's Office, told The Daily Star.Vice Chairman of Association of Bankers Bangladesh Nurul Amin, also managing director of National Credit and Commerce Bank Ltd, said: "Banks need to be prepared for offering such services. Customisation and integration are necessary for this purpose."Security measures along with a legal framework need to be put in place to safeguard both customers and banks, he added. These transactions will only be possible now within the accounts under the same bank offering online banking. Online transaction between banks will be possible with the introduction of e-Payment Gateway, an e-commerce application service provider service that authorises payments for e-businesses and online retailers.Bangladesh Bank had taken the initiative to implement the e-Payment Gateway back in 2008. According to a report, the system should be ready for deployment within the next six to eight months and is expected to be operational at the beginning of the next financial year.“We collect payment manually from 300-400 clients every day. The system consumes huge time and money. Now we are ready to start online payment collection on a pilot basis. We were waiting for this to happen for quite long,” said Fahim Mashroor, chief executive officer of Bdjobs.com.Shoeb Ahmed, former general secretary of Bangladesh Association of Software and Information Services, also appreciated the initiative.He said, “Banks are probably ready for this. But stakeholders and government bodies should be prepared for online banking, otherwise it might not be utilised properly." Shoeb said they proposed that the government establish a central payment gateway.Physical credit and debit card payments are available across the country. Banks need to introduce Application Programme Interface (API) to implement the online credit card payment system. API ensures secure payment on the internet by providing both credit card and PIN numbers.All banks have been advised to remain alert to the misuse of online payment system for money laundering. They will have to report to the financial intelligence unit on whether any irregularity or crime has been committed in violation of the anti-money laundering act.