Presentation On

“Performance, Process & Scenario Of Remittance Of Dhaka Bank LTD In the Context Of Bangladesh ”.

TOPICS OF PRESENTATION

OVERVIEW OF REMITTANCE MARKETPROCESS, PERFORMANCE & FACILITIES THUS OVERALL REMITTANCE ACTIVITY OF DHAKA BANK .

Remittance scenario of Dhaka bank Ltd. Remittance performance of Dhaka bank Ltd. Mobile remittance. Service profile. Facilities provided by mobile remittance. Operational procedure. M-wallet registration and transaction . Mobile remittance accounting process. Mobile wallet process. Bangladesh bank policies. Finishing with a prospective scenario of remittance.

Landscape of remittance in Bangladesh.Key source countries for remittance.Reasons for growth in remittance.Roadblocks in current remittance process.Current market scenario and market players.

A key driver of economic growth and poverty reduction in Bangladesh, increasing at an average annual rate of 19 percent in the last 30 years (1979-2008).

Bangladesh was the seventh largest remittance earner in FY 2010-11.

The semi -skilled or unskilled workers are the main source of obtaining more remittance inflow in the country.

Figure 1: Remittance and number of migrated people

Landscape Of Remittance In Bangladesh.

Key Source Countries For Remittance

In the FY 2011-2012, the highest remittance received was from Saudi Arabia. (29 percent)

The second highest remittance was received from U.A.E (18.65 percent).

The share of Europe in receiving total remittances is only about 8 percent, where most remittances were from the United Kingdom and Germany.

Data trend shows that remittance might reduce further by the end of this current fiscal year.

According to Bangladesh Association of International Recruiting Agencies (BAIRA), over 80,000 Bangladeshis worked in Libya. The recent crisis in Libya has forced to quit many of the Bangladeshi workers from strife-torn Libya.

Figure 2: Share Of Remittance From Different Countries

Reasons For Growth In Remittance

• Stable macro-economic indicators including GDP growth.• Steady growth in manpower export specially in the middle east.• Substantial devaluation of the local currency.• Rapid urbanization.• Development of new remittance corridors in Australia and part of Europe.• Increased focus of Central Bank and the Government to channel funds through

formal channels.• Increased competition among financial institution to grab market share.• Aggressive marketing policy adopted by Banks to increase their share of wallet.• MFIs involvement in channeling remittance funds in remote areas.• Participation in the UN peace keeping missions.• Anti-Money Laundering rules and regulations coming in force.

Roadblocks In Current Remittance Process

Major roadblocks of a smooth and efficient payment of foreign remittances are as follows :

Poor infrastructure in rural and semi-urban economy Inadequate reach of private commercial banks within the

country Massive information asymmetry in the market Active ‘Hundi’ market Inefficiency of financial institutions Poorly regulated exchange houses Low literacy rate in the country Uneven competition among financial institutions Lack of investment in IT backbone development for market

efficiency

These inefficiencies are resulting in because of high share of ‘Hundi’.

At present, the share of ‘Hundi’ business constitutes roughly 40% of total incoming foreign remittances.

Current Market Situation And Market Players

Positive

• The market has experienced a palmy growth in recent years due to the current global economic recession which drove the demand of the low cost labor of Bangladeshi expatriates residing in various countries of the world.

VS

Negative• Because of growing global economy, the demand for specialized and skilled labor force are restraining the demand for low cost labor

MARKET PLAYERS

• State Commercial Banks (SCBs) and the 1st generation Private Commercial Banks (PCBs) have captured the greater share of the market due to their-

1. long time operation in the country and

2. nationwide branch coverage

Market Share in the SCBs & Specialized Banks

Sonali Bank Agrani Bank

Janata Bank BKB

Rupali Bank

Market Share in PCBs

Islami Bank

National Bank

BRAC Bank

Uttara Bank

South East Bank

Pubali Bank

Prime Bank

Others

Remittance Scenario Of Dhaka Bank LtdRemittance Performance Of Dhaka Bank Limited:

Starting from 2004, DB is continuing its remittance business under General Trade Services (GTS) which already has successfully strengthened the remittance disbursement network by including 2,222 telecom point locations in its existing network. DBL has partnered with 18 exchange houses worldwide to facilitate remittance inflow The bank currently has an astounding network of 4,915 remittance disbursement locations nationwideThe bank, through GTS, has established agreement with other NCBs. Moreover, it has entered into the Eldorado, an elite network of 12 PCBs, for inland fund transfer and disbursement.

Dhaka Bank is one of the pioneers in Mobile Remittance in Bangladesh.

The Bank has channelized USD.113 million and USD 117 million in the year 2009 and 2010 respectively with a Growth Rate Of 3.54%

Particulars 2009 2010 Growth Market Growth

Remittance Inflow (Amount in Million USD) 113 117 3.54% 2.06%

No. of Account Credit Transaction 78923 72665 -7.92% NA

No. of Cash Payout ( Apprx.) 19200 44400 131.25% NA

Mobile Remittance [in collaboration with orascom telecom]

DBL has introduced Mobile Phone based Remittance Payment System for the first time in BD which makes it more easy for BD people.

Under this system, beneficiaries will be able to enjoy 2 types of service— 1. M-Wallet Account (Only for Banglalink users)2. Coupon Payment (Cash Payout)

A Hassle Free, Quick And Efficient Settlement Of Remittance For The Rural People

Service ProfileDhaka Bank Mobile Remittance provides service

in 2 facets

1. M-Wallet Account:A virtual account opened and maintained in Dhaka Bank system with assistance from Banglalink server.Receiver receives his/her remittance directly in the M-Wallet account.The process is finishe by receiver’s encashing of the remittance according her/his need. the receiver has the leeway to partially reimburse the remittance in the any 2,222 Bank accredited Banglalink cash point.

2. Coupon Payment:The only difference in this case is beneficiary receives the amount from a Bank accredited Banglalink cash point instead of bank branch or partner NGO branch.beneficiary provides the PIN (secret number) to the Banglalink agent along with other required information. Agent then checks the PIN and matches the information in Dhaka Bank server (routed through Banglalink server) with the help of his mobile phone. Banglalink agents disburse the remittance.

Facilities Provided By Mobile Remittance

For the Beneficiary For The Correspondent

Augmentation of the number of payment locations to 2,222 that literally covers the remotest location of the country (currently 786 locations are in operation and 442 more locations are ready for operation).

Faster disbursement of foreign remittance that will enable a beneficiary to receive his/her fund within 2 (two) hours of receiving the instruction from correspondent.

An extended remittance receiving hour from 9 AM to 6 PM for the beneficiaries.

Introduction of remittance defrayment in the weekends as the Telecom outlets are open 365 days a year.

Option for beneficiary to open a Mobile Wallet account with the bank and receive his/her fund in his/her Mobile Wallet account that facilitates partial encashment of the remittance.

Escalated Customer Service through well-trained customer care executive of Orascom Telecom (Banglalink).

24-7 Call Centre support from the telecom

•Quicker and faster processing of the instructions and Uniqueness of the service will result in more business for the correspondents.

•Multiple payment instructions sending facility in a day as the system will be updated every 2-hour.

Operational Procedure

M-wallet Registration And Transaction

Mobile remittance accounting process

Mobile Wallet Process

Bangladesh Bank Policies

BL (Banglalink) Collection A/C is a non-cheque account and funds from this account cannot be withdrawn by BL. Cash-outs can only be made by DBL to BL after having ‘Successful Transaction’ status sent by BL.

BL will have to maintain the settlement A/C with DBL at all times during the tenure of the agreement even if BL offers this same service to other institutions

Finishing With A Prospective Scenario Of Remittance

Under the business as usual scenario, remittance might stand at USD 12880.05 million in FY 2012-13.

Figure 6:Future scenario of Remittance

THANKS REMMITTED TO ALL OF YOU