Are you 14 years old? Now you can too open an MFS account

The age limit for applicants to open an account with mobile financial services (MFS), such as bKash and Nagad, has been lowered to 14 years from 18, said the Bangladesh Bank.

In a circular issued on Tuesday, the central bank said the relaxation applies to those between the ages of 14 and 18 who hold Bangladeshi nationality and whose parents, or legal guardians are also Bangladeshis.

Tanvir A Mishuk, founder and managing director of Nagad, told The Business Standard, "We welcome the Bangladesh Bank's timely move that will allow young people to open MFS accounts and come under a controlled digital payment ecosystem. Having realised the needs of integrating a large number of young generations into the fold of financial inclusion, Nagad has long been pursuing policymakers for coming up with such a much-needed decision."

He went on to say, "Today, through its circular, the central bank has eased the process to bring 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 with respect to opening MFS accounts of youths. But it remains to ponder over whether the transaction limit set for such accounts is enough, considering the current perspective. I think the central bank will soon review it." 

Major General (Retired) Sheikh Md Monirul Islam, chief external and corporate affairs officer of bKash, also applauded the BB decision. "Under the supervision of guardians, this MFS account for 14-18-year-olds will familiarise the new generation with the digital payment ecosystem, ensuring proficiency in cashless transactions. This opportunity to open individual accounts for young customers will serve as a milestone in Bangladesh's MFS sector," he further said.

According to the BB circular, an applicant needs to provide his/her birth certificate and the national identity card number of his/her legal guardian to open an account. The account will also be connected with the legal guardian's MFS account. The legal guardian's account will have to authenticate the account of the applicant.

Transfers to the account, or cash-ins, have to be done through the legal guardian's bank account, MFS account, card or e-wallet.

Agents or other MFS accounts cannot be used to enter cash into the applicant's account, unlike the traditional practice. 

The account can be used to cash out, make person-to-person transfers, recharge mobile balance, pay utility bills and education fees, and make merchant payments.

The maximum transaction limit for cash-ins in such accounts has been reduced to Tk5,000 daily and Tk30,000 monthly.

A cash-in can be done a maximum of five times a day and 10 times a month. 

For cash-out, the limit is Tk5,000 daily and Tk25,000 monthly. It can also be done a maximum of five times a day and 10 times a month.

For person-to-person transfers, the daily limit is Tk5,000 and monthly is Tk15,000, with the number of transactions remaining the same.

For any kind of payment, the daily limit is Tk5,000 and monthly is Tk20,000. These can be done three times a day at most and 10 times a month.

Such accounts can have a maximum balance of Tk30,000.

"The decision was taken as part of our move towards a 'cashless Bangladesh'. We have just started the system. We will make changes according to how the market responds," said Md Motasem Billah, director of the central bank's Payment Systems Department.