The Bangladesh Bank has set up a Tk100 crore refinancing scheme titled "Digital Microfinance" for customers of mobile financial services (MFS) providers.
The decision was made at the latest board meeting of the central bank.
According to bKash, the country's largest MFS provider had already started this activity by signing an agreement with City Bank.
Loans ranging from Tk500 to Tk20,000 will be given to eligible customers on the basis of various criteria. The interest rate is 9% and the term is a maximum of three months, it added.
According to a senior central bank official, only those banks which are offering mobile banking services will be able to avail of finance from this fund. And institutions such as bKash and Nagad which do not have affiliation with banks will enter into an agreement with any bank.
He added that a bank would receive funds for a period of three months on the basis of an agreement with the central bank. New funds will have to be received by repaying the previous debt after three months on the basis of the contract.
At present 13 companies such as bKash, Rocket, mCash and upay are providing financial services through mobile banking in the country. The postal department's service "Nagad" is offering a similar service although the state-owned institution was not included as a mobile banking service.
In March this year, a record transaction of Tk77,022 crore took place in the mobile banking sector. Earlier, in January, customers transacted Tk73,393 crore – by far the second highest transaction in mobile banking in a single month.
In May last year, the third highest transaction in mobile banking was Tk71,247 crore, according to the updated statistics of the Bangladesh Bank.
The bKash authorities said, only customers who have joined the MFS provider through a biometric system are getting a digital loan from City Bank. Only those who are using the bKash app and do various types of transactions regularly are getting priority in availing of the loans.
"As a result, those who have become customers in a conventional way with national identity cards, are not getting loans now. As well as those who are not using the app, they will not get a loan," they added.
The bKash authorities further said that for those who have completed registration in the traditional way and become customers, the bKash authorities are taking initiative to re-register them through an electronic biometric system.
As a result, many more customers will qualify for the loan. Besides, they have taken the initiative to bring those who have become customers under the conventional system under the loan facility. The Bangladesh Bank has been contacted for this.
As per the guidelines of the central bank, customers can be given loans only after completing e-KYC through a biometric system.