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, they added.
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 programmes as well as collaboration among fintech firms and commercial banks will further stimulate the industry growth.
“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.
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 cashback offers and likely to introduce lucrative services in cooperation with global players.
More than 50 million people are using mobile financial services offered by 18 banks to meet their needs under a conducive regulatory environment.
The industry has experienced 120 per cent growth since 2011 thanks to rapid customers’ 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 Rockets and Sure Cash”, said the central bank official. It is expanding its customer base with lucrative cashback offers.
bKash has already adopted QR code in its payment apps to facilitate customers 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 crore in 2018, which is 20 per cent higher than 2017. Moreover, the number of active customers has also increased to 3.73 crore 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.”