Tanvir A. Mishuk, a visionary to break the monopoly in the emerging DFS (Digital Financial Service) industry in Bangladesh and to improve the overall financial inclusion scenario of the country, has been a leading entrepreneur in diversified industries like, telecommunications, ICT, Fintech, Event Management and so on. Back in the days when the internet was not vastly available, an initiative of his, in partnership with a company in Singapore, made overseas calling affordable for the diaspora living there. Tanvir A. Mishuk is the Managing Director of Third Wave Technologies Limited, as well as the founder and Group Chairman of T-Asia Group. He is also one of the directors of Sigma Group.
During the conversation, Tanvir A. Mishuk opened up about his latest venture, Nagad which became an overnight sensation because of its innovative approach and value proposition to be the game-changer in the DFS industry in the country.
BBF: Please tell us about Nagad.
Tanvir A. Mishuk: On 26th March 2019, Nagad was launched as the digital financial service of Bangladesh Post Office, on the auspicious Independence Day of Bangladesh, by the Honorable Prime Minister Sheikh Hasina. It maybe be precocious, but I believe Nagad has the potential to be one of the most successful public-private partnership projects in Bangladesh. Nagad operates under the regulatory framework of Bangladesh Post Office (BPO), governed by the Ministry of Posts, Telecommunications and Information Technology, to provide digital financial services (DFS). 51 percent of Nagad’s share is owned by Bangladesh Post Office and the rest is owned by Third Wave Technologies Limited. We, here at Nagad, are handling operations while the government is providing us with the license.
What made you realize that Nagad would be the right idea to evolve the landscape of the financial industry?
Around 47 percent of Bangladeshis are yet to be a part of any financial network and still remain unbanked. That means almost half the population’s financial activities are taking place in an informal setup or over the counter. We wanted to target this group with zero financial access and hence invented the Digital Customer Acquisition Process (DCAP).
There are several considerable reasons behind this obtrusion in the path of wholesome financial inclusion. The first reason is the hassle of getting access to the financial channels. We tried to take care of this part by making the process easier for the customers so that they do not have to take up the burden of taking pictures, collecting documents, filling up a form, etc. Nagad has facilitated this exact process through introducing DKYC (Digital Know Your Customer) where you need just your smartphone, NID and internet to open an account within a minute.
Another reason is the high cost of acquiring and servicing customers by the formal channels. In the traditional banking channels, a very high fee is charged to the customers. Nagad is mitigating this gap by being the most inexpensive financial service provider out there and through its recent campaigns of cashback offers.
Also, due to the lack of financial literacy and adaptability issues, a vast number of people have preset psychological barriers to use traditional financial services. At Nagad, we preach the value that in this day and age of information revolution, no one should feel a financial barrier and no opportunity should be missed because of that.
What are the benefits Nagad has for being associated with the Bangladesh Post Office?
Nagad actually came onboard to digitize the services provided by the Bangladesh Post Office. Being a 150-year-old entity, Bangladesh Post Office already has access to our day to day financial activities which already has a positive influence on increasing financial inclusion. Over the years, the postal operations had to be digitalized to cope with the needs of the 21st century.
If we compare it with the penetration of financial institutions like banks, till date there are 59 scheduled banks in Bangladesh. The maximum number of outlets a bank can possibly have is about 3000 branches all over the country. Whereas according to data provided by the Bangladesh Post Office, the total number of post offices is over 9000. On top of that, today we have more than 1,40,000 agents all over the country. So through Nagad, you are not only able to send and receive money digitally from your phone, but also through the agents located right next to your home.
What is Nagad’s Marketing Approach to increase financial inclusion?
We have been running a campaign called “Paben Beshi Deben Kom” where we offer our customers the most ‘value for money’ cash-out charge, which is also the lowest in the industry, at Tk 14.50 per thousand. On top of that, they get Tk 5.00 cashback on per thousand cash-in. Earlier this year, Nagad signed an agreement with Robi, that enables Nagad to add Robi’s 5 crore customer base to its existing base of over 1 crore 22 lakh customers.
To bring more agents on board, we have started “Amrai Nagad”, under this initiative we conduct events with our agents. We provide them with a platform to express and share their stories. At Nagad, our utmost effort is to make both our customers and agents feel heard and valued because they all are equally important stakeholders for us.
How do you plan to foster innovation in Nagad?
Initially, we offered a couple of services provided by the Bangladesh Post Office through Nagad related to Money Transfer Service through Send Money and Cash in/Cash out. In the future, we are also planning to include all postal money services that can be carried out digitally on Nagad’s platform.
How do you see the future of Nagad?
2020 can be a very exciting year for Nagad. In fact, recently, the Honourable Prime Minister of Bangladesh Sheikh Hasina has declared that all sorts of government benefits will soon be disbursed through Nagad. This will help to improve the lives of those living in remote areas, especially the distressed, disadvantaged, old and disabled, who otherwise would have to pay a visit to a bank in town every time and stay in line to get the money.
Nagad is hopeful about a positive and impactful future for the people of Bangladesh that goes beyond just its own business operations and goals. Nagad aims to provide the most secure, convenient and fastest financial transaction by connecting, reaching out and uplifting people of all classes, categories and professions across Bangladesh. On this note, Nagad’s core ambition is to contribute to enhanced livelihoods, economic empowerment, that in turn improves social welfare while providing the building blocks for further growth of the millions of people of Bangladesh.