Banks urged to make banking open to drive financial inclusion

A roundtable dialogue on API and Open Banking: Way for New Service Innovation for Banks and Fintech companies was Organized by the BASIS Standing Committee on Fintech, the roundtable was held on 24th August 2022 at Lakeshore Hotel Gulshan. High officials of 20 leading commercial banks and over 30 fintech entrepreneurs attended the roundtable. Bangladesh Bank Executive Director Md. Khurshid Alam chaired the roundtable. Selim Hossain, Chairman of Association of Bankers (ABB) was the Special Guest. In Lakeshore Hotel Gulshan moderated by Fahim Mashroor, Chairman of BASIS Committee on Fintech and CEO of Bdjobs.com in collaboration with BASIS.

Discussants make the suggestions for introducing API based Open banking so that more people can be brought under banking services. Open and API banking, a new concept that is getting very popular in both developed and developing countries, is reducing the cost of traditional banking and increasing new revenue opportunities for tanks. In the Open banking system, traditional banks collaborate and share data with other banks and fintech companies so that innovative financial services can be introduced faster and cheaper.

Bankers and Fintech companies urged the Central Bank to introduce supportive guidelines and required a standardization process so that banks and fintech companies can share data based on customer consent keeping data privacy and security. The session emphasized that any financial transaction data is owned by the customer or user. Banks or mobile financial services are only custodians of the data. If any user wants to share the data to any third party to get any financial services like loans from any other financial organization, the custodian banks should make provision for that data sharing.

Three keynote speakers presented in the roundtable. Todd Schweitzer, CEO of Brankas, a leading open banking fintech company in the Philippines and Singapore, shared best practices of open banking in the Southeast Asian region. Jayanta Bhoumic, Deputy Director of Payment Service Department of Bangladesh Bank gave another keynote on the topics and discussed the possible roadmap of API-based open banking in Bangladesh. Redwan Ansary, CEO of Circle Fintech gave a presentation on the required policy support for enabling greater partnership between banks and fintech companies.

Chief Guest of the program Md. Khurshid Alam of Bangladesh Bank shared the Central bank’s commitment to the required policy and regulatory support for open banking in Bangladesh. He also mentioned that the Central Bank will facilitate new innovation by young fintech entrepreneurs by giving them all kinds of regulatory support. He also advised banks for greater collaborate with local fintech companies.

Fahim Mashroor, Chairman of BASIS Committee on Fintech and CEO of Bdjobs.com, mentioned that open banking is the best way to solve the big problem of low loan disbursement ratio of banks to the MSME segment. “The problem of high operation cost for banks for mSME loan disbursement and repayment can be solved by open banking based digital lending”.

Head of IT and Digital banking of a number of banks including Brac Bank, UCB, HSBC, Bank Asia, Islami Bank, Mutual Trust Bank, City Bank, Jamuna, bKash, Nagad, Upay and other financial institutions attended the program and discussed the topics.

BASIS President Russel T Ahmed, Vice President Fahim Ahmed along with over 30 BASIS member companies were also present in the roundtable.

A different pay scale with a unique hierarchy for tech professionals and a separate law for knowledge-exercising human resources engaged in the ICT sector while addressing a meeting at Bangladesh Association of Software and Information Services (BASIS) in the capital on Saturday.