14-18 year olds allowed to open MFS accounts

Bangladesh Bank yesterday allowed individuals aged between 14 and 18 to create MFS accounts with their parents' approval in a move that could boost digital transactions.

The move aimed to facilitate digital transactions for the youth as part of the government's endeavour to develop a cashless country, Bangladesh Bank said in a circular.

To open an account, individuals in the 14-18 age bracket must enter their birth certificate number and national identity number. Their guardian must then link their account with their child's account through an OTP.

Money can only be received from their guardian's MFS, bank accounts, cards and e-wallets. They cannot add money from agent points or accounts owned by someone other than their guardian.

Both the person who wants to open the account and their guardian must be citizens of Bangladesh.

Such accounts can receive a maximum of Tk 5,000 daily and Tk 30,000 monthly and cash out Tk 5,000 daily and Tk 25,000 monthly.

The BB directed MFS providers to monitor the accounts intensively.

About 20.95 crore users have been registered with 13 MFS providers as of July in a country of about 17 crore people, with many using multiple accounts.

MFS providers welcomed the move.

"We welcome the Bangladesh Bank's timely move that will allow young people aged between 14 and 18 to open MFS accounts and come under a controlled digital payment ecosystem," said Tanvir A Mishuk, founder and managing director of Nagad Ltd.

Having realised the need to integrate the younger generations in order to enhance financial inclusion, Nagad has long been pursuing policymakers to make such a decision, he said.

"Today, through its circular, the central bank has eased the process of bringing young people under financial inclusion, thus contributing to the government's pursuit of building a Smart Bangladesh.

"The Bangladesh Bank has also imposed some necessary restrictions. But it should be mulled whether the transaction limits set for such accounts are enough considering the current perspective. I think the central bank will review it soon," he added.

Shahed Alam, chief corporate and regulatory officer, Robi Axiata Ltd, said: "We welcome the Bangladesh Bank initiative to allow 14-18 age groups to open MFS accounts, which is a visionary step towards the implementation of Smart Bangladesh as well as creating a cashless society. It will bring multiple positive impacts for the country if the same age group could register SIM cards directly."

The need for MFS accounts for the digitally-literate younger generation was seen in market research conducted by bKash, said Sheikh Md Monirul Islam, chief external and corporate affairs officer at bKash.

"We have been sharing market insights related to such initiatives with Bangladesh Bank. Going forward, bKash will take all necessary measures to implement this special MFS account initiative to make the younger generation habituated to digital transactions," he said.

"Such MFS accounts will help change the behaviour of youngsters when it comes to digital payment ecosystem as well as cashless transactions. The opportunity for young customers to open such MFS accounts will be a milestone in MFS sector's journey in Bangladesh."