e-AOF: Time to move on from paper forms

To open a bank account, the first thing a customer has to do is to fill up a form. Most of the time, customer fills up the form with the help of a bank official, accepting all the terms and conditions of the product by signing all the pages of the form through a clumsy process.

Many people do not want to break traditional rules. But there can be no breakthrough if people do not break free the shackles of traditions.

In September last year, I wrote an article in a renowned English daily of the country, suggesting whether it was possible to enter data directly into the Core Banking System without using a conventional account opening form (AOF). In the article, I also mentioned how a bank will be benefitted from it and how much money and time will be saved, ensuring 100 percent security. This article is an elaboration of that topic.

I have been in the banking sector since 2009. I have seen customers of a bank come to the bank or the bank reach out to customers, based on location.

At least 65 percent of the account opening forms are used in the banks instantly. Twenty percent of the forms are taken by customers to their homes and usually, they never come back to the bank. In case, they come again, the bank provides them with new forms. Around 10 percent of the forms are either defective or damaged by bank officials and customers. The rest five percent of the forms are not found when they are required. These forms have to be created again with the help of customers.

It will certainly be a huge task to find old forms from the stack in a bank, which has 20,000 accounts, and when the number of bank accounts is on the rise. When all the information of the forms is stored in the Central server of the Bank (CBS), what is the use of preserving the old forms year after year? The answer to this question is the guidelines of the regulatory body.  

The good news is that Bangladesh Financial Intelligence Unit has already formulated a policy, where Know Your Customer (KYC) forms for the accounts with a balance below Tk1,00,000 have been simplified using National Identity Cards. It means a customer does not need to fill up any form for opening an account. If the transaction exceeds Tk1,00,000, the customer has to come to the nearest branch or agent banking centre and fill up the conventional form.

The latest technology has brought operational excellence in banking. The big lasers books are no longer be found in any bank. The golden tokens with which customers used to stand in a queue to withdraw money have now become obsolete. Internet banking and various digital products now attract more customers.

The main issue of e-Account Opening Form or e-AOF is how the customer will sign in it. The solution is customers have to sign with e-pen and the bank will give them signature cards because many customers have seals, which they can use in checks. In our country, mobile financial services like Bkash, Nagad, Ucash and Rocket are maintaining digital accounts of customers and the normal flow of transactions have been maintained as per the existing law. So this method can also be applied to our conventional banking.

Every bank relentlessly tries to ensure the security of the customers' deposits. When a customer dies, his or her account opening form is required to mark the account as deceased.

If a bank is more than 20 years old and it has two million-plus customers, it will be very difficult to dig out the early account forms to mark as deceased. But if the implementation of e-AOF forms is possible, the preservation of old papers will no longer be required. Countless bankers will be able to devote their working hours to other creative work and customer service.

Let's talk about cost curtailing. A bank has to spend a significant amount of money on printing, photocopying, transporting and storing account opening forms. At present, many banks have to open many accounts for agent banking purposes, and to some extent this number is huge. Since bank officials do not attend agent banking offices run by entrepreneurs, the possibility of missing the forms is high. Moreover, officials of the tagging branches or back offices have to work hard to regularize the forms of agent banking. e-AOF can solve these problems. The cost of banks will also drop significantly.

Syed Abdur Rakib works at the Head Office of Midland Bank Limited .writer.rakib@gmail.com