Special Interview of Tanvir A Mishuk, Managing Director of Nagad. By: Tauhidul Islam Apu

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26th March 2019, Honorable Prime Minister Sheikh Hasina launched “Nagad” first ever  digital financial service of Bangladesh Post Office under the dynamic leadership of TanvirAMishuk. His vision is to improve the “financial inclusion” scenario of Bangladesh. 900+ skilled resources are in this change journey to bring revolution in the financial landscape of Bangladesh. Tanvir is one of Bangladesh’s most successful investors and has been shaking up corporate sectors for more than 12 years. A Bangladeshi business magnate with prejudice for state-of-the-art technology, operationally nimble investor and philanthropist.  He is renowned internationally for Change Management journey for his companies & adaptation of culture for data-driven decision making. He is now successfully leading diversified companies from industries like Telecommunication, ICT, FinTech, Management Consultancy, Water management solutions, Energy, Aviation, Hospitality, etc. He is a great believer transformative power of Strategic Innovation in driving the growth and development of emerging countries and has chosen the digital realm as his current playground. He is also driving to implement “fit for purpose” Management Control System to integrate and govern end to end process, drive compliance and behavioral change for first time in the history of Bangladeshi Companies (which is usually implemented by Fortune 500 companies). Tanvir is also the founder and Group Chairman of T-Asia Group. He is also one of the directors of Sigma Group. Today we are going to talk with Tanvir about recent talk of the town Nagad.

  1. Please tell us about Nagad

Nagad is a Digital Financial Service (DFS) company that is working to market digital financial & other associated services to the mass population while ensuring compliance & better customer experience. This will contribute to the financial inclusivity & socio-economic development of the country. Nagad operates under the regulatory framework of Bangladesh Post Office (BPO), national postal and financial service authority of the country, to provide digital financial services (DFS). The revenue sharing model is based on 51% public & 49% private owning structure. The brand is operated by prominent fin-tech company Third Wave Technologies Limited (TWTL). It is an immense privilege that our honorable Prime Minister Sheikh Hasina has formally announced the launch of the brand ‘Nagad’ on the remarkable event of Independence Day on 26th March 2019.

  1. Currently, there are 16 Mobile Financial Service (MFS) Companies operating in Bangladesh. As you have launched the first-ever DFS platform in Bangladesh, how are you differentiating DFS from MFS?

MFS should involve the utilization of a mobile phone to access financial services and execute financial transactions, but unfortunately, in our country, MFS is doing only remittance business. MFS in Bangladesh is yet to become a channel for formal financial needs such as mobile banking, mobile payments, mobile money, mobile insurance, mobile credit, and mobile savings, etc. MFS business model is digital and upgraded version of Bangladesh post office 100 years old product money-order.

Therefore we see an opportunity now for an extended platform to be introduced in the economy which will work as an enhanced and parallel service to both MFS and banks. Such a platform is the Digital Financial Services (DFS). DFS encompasses all products, services, technology and/or infrastructure that enable individuals and companies to have access to remittance, payments, insurance, savings, access to all government services and credit facilities via the Internet (online) without the need to visit a physical bank or any direct interaction with financial service providers. Bringing together the agents (called as Uddokta in Nagad system) and the networks of other third-party intermediaries, DFS expands the delivery of traditional banking services to their customers through Internet banking, mobile-phone-enabled solutions, electronic money models and digital payment platforms, and lowers the overall service delivery cost. It has already been introduced in other parts of the world and it is helping the economies to be developed at a fast pace.

  1. What are the barriers to financial inclusion in Bangladesh?

Around half of Bangladeshis are still devoid of access to the proper financial channels. There are several grave reasons which are hindering them from doing so. The first reason is the high cost of acquiring & servicing customers by the formal channels. In the traditional banking channels, the very high fee is charged to the customers. Financially challenged customers feel unwelcome as there is lack of customer centricity in service & products in the current system. Due to the lack of financial literacy & adaptability issues, a vast number of people have mental barriers to take the traditional financial services. Customers cannot take the full use of available facilities due to the limited access to banking channels.

  1. You said that ‘financial inclusivity’ is a concern point in achieving financial independence for a country like Bangladesh. How will ‘Nagad’ address this issue?

Despite the notable expansion of financial services in recent years, around half of Bangladeshis aged 15 or above remain without a bank or mobile money account, (according to a study from The World Bank). Though currently there are 57 banks in Bangladesh, they mostly serve the urban-based population, who represent the top of the pyramid. Therefore, the economic system demands an alternate formal financial service that will serve the bottom of the pyramid of this nation. Recently we can observe some developments through agent banking and mobile financial services. Nagad, as a Digital financial service (DFS), can expand the delivery of basic financial services to the financially challenged through innovative technologies like mobile-phone-enabled solutions, electronic money models and digital payment platforms. Digital channels can drastically drive down costs for pro-poor customers and service providers, opening the door to the remote and underserved populations.

  1. From a country perspective, how do you see the current context in Bangladesh to do a fin-tech based business?

According to Pricewaterhouse Coopers, Bangladesh will be the 28th largest economy by 2030. Digitization in all sectors will be a catalyst to this economic growth, it is a cyclic process, more economic growth means more digitization and more digitization means greater economic growth.  Making a digital country will be an important step to make a durable & sustainable economy. Digital Bangladesh is therefore not only a dream, but also a mandatory pre-requisite and various special emphasis have been given on the application of digital technologies to realize Vision 2021. By 2021, after 50 years of independence, our goal is to be a middle-income country with peace, prosperity, and dignity. The government of Bangladesh under the leadership of Prime Minister Sheikh Hasina and her capable ICT Affairs Advisor SajeebWazed Joy, embarked on the journey to build a technologically advanced Bangladesh. Under the direct supervision of this successful Government, a large number of judicious projects relating to digital technologies have been implemented and a number of these are already underway. Additionally, assistance & guidance from the Ministry of Post, Telecommunication and Information Technology of Bangladesh has enabled us to render great services for the mass population of Bangladesh.

  1. What is your vision regarding ‘Nagad’?

We envision Nagad to play a pivotal role in digital transformation in Bangladesh. It will be a significant facilitator in the exciting journey of making Bangladesh as an example of a successful economy. We foresee to contribute to the overall financial eco-system in Bangladesh by improving financial inclusivity scenario.

  1. Please tell us about the services offered by Nagad?

Nagad aims to provide digital financial services at all times, for all necessities, from all places in Bangladesh. We have several value generating products available in our portfolio, with a host of essential services such as cash in/out, P2P money transfer and mobile top-ups. The purpose is to enhance the lives of people by empowering them with financial flexibility. As we are evolving to generate value for the financially challenged population in Bangladesh, we aim to include various exciting user-friendly products and we believe in continuous research and development in this regard.

  1. On the aspect of introducing new product features, we have come across Nagad’s Digital KYC (DKYC) registration process. Please tell us about the features.

To uphold the modern philosophy of using appropriate technology in all facets of the economic cycle, Nagad has introduced digital registration process termed as ‘DKYC registration process’ that is considered first of its kind service for the mass population of Bangladesh. The Digital KYC Registration has been introduced to ensure the hassle-free process for the customers. It will also ensure that there will be no chance of duplication and fraud. To complete this process, customers are required to use only their National ID Card and mobile phones. Pictures of the customer and the ID will be taken immediately and validated with the Election Commission Database in real-time through artificial intelligence (AI). The respective fields of the KYC form will be filled up by an automated scanning process extracting information from the NID. The entire process will be concluded within a few minutes which is a remarkable feature brought for the first time by Nagad. This is worth mentioning that the whole registration process will be accomplished in Bengali which is a matter of pride for us and it will ensure user-friendliness in all level of citizens. Nagad acknowledges its gratitude to Mr. Mustafa Jabbar, Minister, Ministry of Post, Telecommunication and Information Technology, the Peoples Republic of Bangladesh for inventing the first ever Bengali keyboard ‘Bijoy’ which has inspired us to use Bengali in all through the operation of ‘DKYC’.

  1. How does Nagad’s DKYC differentiate itself from the traditional paper-based KYC?

Currently, paper-based KYC is being used in the financial system to complete the registration process which requires approximately five to seven days. This time consuming and costly procedure precludes the economically challenged groups from getting registered into the formal financial channel. Nagad’s DKYC has alleviated this problem by enabling the users to complete the registration process through personal mobile phones which is the most cost-effective and time-saving solution available in the existing financial eco-system.

  1. In this fast-paced technology changing the environment, how will Nagad adapt with the market dynamics?

We are committed to bringing amazing service features to peoples’ fingertips that will ensure user friendliness at all levels. Technological changes are obvious and to match with the market expectations, we need to evolve ourselves. In this consequence, we have brought another revolutionary service for our customers that is ‘Send Money to Any Number’. From now on, anyone can send money to any number and we have a very strong network of uddokta points throughout the country-wide where cash-out can take place at users’ convenience. We are transforming the existing traditional products with new digital features that will ensure more cost-efficiency& reduction of operating time. Our profit generating ‘Savings product’ feature is such a solution that aims to give benefit to the service recipients based on several schemes which are very first of its kind in Bangladesh. Our Nagad application has already been well-accepted among the mass population and we have been working diligently to incorporate new features for serving the people.

  1. ‘Nagad’ has already been well-accepted in the market place. To meet the market requirement, how it formulizes the strategies to make itself different from the competitors?

Nagad believes in perfect competition with infinite buyers and sellers in the market economy. Since we have been operating in changing technology environment, it is essential to make continuous development in the operation style. We have innovative products & features to address market needs. ‘Digital KYC Registration Process’, ‘Send Money to any Number’, ‘Digital Savings Scheme’ are some of the noteworthy approaches taken to maintain our commitment towards optimum customer service. Our offered products have multiple access channels with more user-friendliness and higher security. We ensure widespread availability with of the product, making it available across 100,000+Uddoktas located throughout the country.

  1. How does Nagad measure the current market opportunities?

We are a benevolent organization that aims to serve the mass population of Bangladesh with unique services & product offering. There exists a huge untapped market portion where we can operate and there is already a market demand for digitized financial services. Only in 2019, we are looking at a 90 million potential target market where 57 million people are lacking any formal financial channel. In monetary terms, the current market opportunity will have a value of USD 50 billion with an average yearly growth rate of 20% which is a great market to serve in.

  1. In your opinion, what are the value generating factors of Nagad?
  • Our synergy with Bangladesh Post Office (BPO)helped to build trust among customers which is a great advantage in terms of Brand association. One of our remarkable product features is daily cash out limit of BDT 250,000 which will help the SME sector a lot through faster money circulation. Our association with BPO is unveiling this opportunity to us.
  • As a Government-affiliated service, Nagad will have access to Government disbursement of around 10 billion dollars which is a huge opportunity for the venture.
  • MoreoverNagad can connect with all the utility service providers at the shortest possible time and offer the widest array of utility bill payment services to customers.
  • Delivery of products and services offered will be quite easy for Nagad as it leverages the existing infrastructures of 9886 Post Offices and more than 8500 Post e-centers of BPO.
  • TWTL has a very experienced network of proven distributors & uddokta channels who are playing a very pivotal role to provide the services at our customers’ doorsteps.
  1. In the DFS platform, it is important to have a strong verification system to safeguard the transaction. How is Nagad addressing this issue?

Securing a transaction in order to save the customer’s full interest is the main concern for all fin-tech ventures. To protect the customer against any exposure to fraudulent activities, we have adopted strict measures. Our Nagad platform has been developed by TWTL own team is associated with the most renowned Korean Fintech company who is the epitome in providing total solutions & platforms to the global Fin-tech market. With our proven technologies, we are delivering trustworthy services to a great number of population.

  1. How do you see the role of effective leadership in your way of managing this business?

In my opinion, it can be difficult to place a value on leadership or other qualitative aspects of a company, versus quantitative metrics that are commonly tracked and much easier to compare between companies. Leadership can also speak to a more holistic approach, as in the tone a company’s management sets or the culture of the company that management establishes.

Leadership provides direction for a company and its’employees. Employees need to know the direction in which the company is headed and who to follow to reach the destination. At Nagad, employees consider themselves as partners and patrons of the company, rather than just an employee who performs tasks and is involved in a 9-5 job.

At Nagad, we have got experienced and proven industry leaders who are guiding the company to achieve the vision of becoming a strong part in the country’s economic backbone. Their diligent services and shrewd strategies are materializing the various complicated problems into simple and reasonable solutions.

  1. It is often told that Competition in the marketplace is good for consumers and good for business. What is your view in this regard?

Competition among companies is a boost to innovation. We always welcome competition as it can spur the invention of new or better products or more efficient processes. It gives us the thrust to initiate a new or different technology. Innovation also benefits consumers with new and better products, helps drive economic growth and increases standards of living. When companies compete with each other, consumers get the best possible prices, quantity, and quality of goods and services.

  1. Is it possible to bring all the financial transactions of rural and urban cities, all of which can be brought under the Digital Financial Services?

Easy-to-use Digital Financial Services is predominantly providing a convenient platform for individuals to carry out basic financial transactions including payments for electricity, water supply, money transfer to family and friends, etc. If digital finance platforms are easy-to-use, users of digital finance services can help inform and persuade their peers in the formal and informal (rural) sector to take advantage of DFS. This will lead to a greater number of individuals using digital finance which will ensure greater financial inclusion. Bangladesh has recently emerged as a curious case of digital innovation to widen coverage and reach remote pockets. Therefore, I believe all the financial transactions in rural & urban areas can be brought under Digital Financial Services.

18. How do you ensure proper customer service in your operation?

At Nagad, we prioritize customer satisfaction and value addition above anything else. A customer service revolution is occurring in digital financial services. It is dynamic and is driven by consumers who are embracing digital and mobile channels which never happened before. Nowadays, we see customers are active over social media apart from regular physical interactions. Therefore, from our passion to serve best, we are 24/7 open to our customers through our call centers and digital space. The rise of digital channels, digital communication, social media, social networks and word-of-mouth across to a connected universe gives us a glimpse into the power and potential to solve problems, address complaints proactively, and potentially predict outcomes before they occur and we embrace this as an opportunity. This is noteworthy that we have ensured proper physical service points as well. Our presence in the post office in the form of ‘Nagad Sheba’ confirms our attitude to solve problems when it arises.

  1. What are the long-term goals of Nagad?

We have measurable long-term goals to achieve and in our operation, we always adhere to those goals when we execute any strategies.

  • To maximize revenue for the partners by marketing digital financial & other associated services
  • To digitize the BPO services
  • To facilitate the mass population who are out of any financial services
  • To contribute to the socio-economic development of the country
  1. Let’s talk about the people who have been working to make ‘Nagad’ a successful initiative. How do you value your employees?

We value our colleagues the way we value our customers simply because they are our company’s biggest assets. With their dedication and hard work, we are gaining customers in the first place. We invest in our employees seriously and treat them in the best possible manner by providing them necessary career-oriented training and providing several tangible& intangible benefits so that they feel motivated to achieve the organization goals. We see them as partners and patrons in the journey of Nagaland we try to ensure that they feel the same.

  1. What will be the shape of Digital Financial Services in the coming future and how does ‘Nagad’ place itself in the new era of financial eco-system?

According to the Economist, by 2020, more than five billion people and businesses, and at least twenty billion devices, will be connected to the internet. With people, businesses and devices communicating, transacting, and even negotiating with each other, a new world comes into being—the digital business sphere.

The evolution of digital financial services will complete the massive scale of digital transformation in every level of lifestyles. Nagad’s strong presence in this digital revolution will ensure more user-friendliness from the customers’ perspective and connect a great number of people to the worldwide transaction atmosphere by generating new business opportunities and more financial liberties.

  1. What are the sectors where ‘Nagad’ the digital financial service can play a role? 

My answer will be ‘everywhere’ that involves any financial transaction. I can assure you it will be the National Wallet of Bangladesh. The benefits of Nagad extends well beyond conventional financial services: This can also be a powerful tool and an engine for job creation in Bangladesh and a mode of the transaction at any eco-system from SMEs to large scale industries, from households to government level projects and operations.

 23. What are the initiatives you have taken to make ‘Nagad’ visible at the all known touch points?

We have a huge network of Distributors and Uddoktas all over the nation who own the brand in their heart. Our field force is working diligently to make the service available within the next door-step of any customer. We are continuously investing heavily in several marketing & brand building initiatives to create brand awareness, and to be at the customer’s top of mind. Our top-notched customer service ensures our availability for any necessity. Therefore, we can foresee any market changes and offer our consumers with the required product features and services in order to add value to our customers.

  1. As Nagad operates under the regulatory framework of Bangladesh Post Office (BPO), national postal and financial service authority of the country, to provide digital financial services (DFS), how will the benefits of Bangladesh Post Office be leveraged through the service of Nagad?

Bangladesh Post Office (BPO) is a government organization working under Posts and Telecommunications Division, Ministry of Posts, Telecommunications and Information Technology, Government of the People’s Republic of Bangladesh. BPO is the most experienced institution in handling financial products in Bangladesh – as it is the oldest financial institution in the sub-continent, dealing with financial products for more than 150 years and operates under its own financial regulations. BPO currently employs more than 40,000 people across its 9,886 post offices and around 8,500 post-e-centers to provide various services

Nagad capitalizes this exclusive channel for Government disbursement as it is a Government-affiliated service. It is noteworthy to mention here that there are various types of government allowances under social safety net programs amounting to approximately 10 billion dollars per year. Through this unique venture, Nagad is very optimistic to transform these safety net programs into digitized hassle free services.

  1. How does Nagad contribute to UN-derived Sustainable Development Goals of the People’s Republic of Bangladesh?

Since Nagad perceives immense opportunities to include the financially challenged population of Bangladesh under formal channels, it contributes to achieving the SDGs through its innovative operation. We aim to improve the life and livelihood of people through creating Uddoktas(micro-merchant entrepreneurs) and facilitate transactions, which will be a source of added revenue for the merchants. We digitize transactions to progress towards cashless society creating a positive impact in the economy. Moreover, we are offering financially innovative products to resolve the pain points of end users. Nagad is promoting a cashless society where dependence on physical infrastructure is reduced. We are empowering women by creating Female Uddoktas (micro-merchant entrepreneurs) and providing support for growth towards sustainability. In a nutshell, we are generating sustainable impacts throughout the economic pyramids.

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