EkPay, an e-payment method under the Aspire to Innovate (a2i) programme of the government, has been providing services without obtaining a licence from the Bangladesh Bank, which is a clear violation of the Payment and Settlement System Act-2024.
The a2i programme is being operated by the Division of Information and Communication Technology (ICT) in collaboration with United Nations Development Programme (UNDP). It is a special programme of the past government's Digital Bangladesh agenda.
As per Payment and Settlement System Bill-2024 which was passed early July, no person, institute or company can operate such financial services without obtaining proper licence from the Bangladesh Bank.
However, EkPay Payment System Operator (PSO) has been operating since 2019 without obtaining any licence.
The banking regulator introduced the Bangladesh Payment and Settlement System Regulations-2024 and it bars such online payment services without central bank licence.
In this regard, experts said that the platform has been doing business over the years by bypassing the central bank regulations. The regulator remained silent as a division of the government owns the platform.
In October 2019, former prime minister Sheikh Hasina's ICT adviser Sajeeb Wazed Joy inaugurated the payment system during a ceremony arranged by the ICT Division.
a2i officials said that EkPay has been providing digital payment services for 147 government services under 78 departments of the government. Five banks, nine mobile financial service providers and internet banking services are linked to the platform by the initiative of three banks.
The PSOs make Tk2 crore to Tk3 crore financial transactions through 10,000 to 15,000 services per day.
In July of this year, EkPay applied for a licence from the central bank for the first time to operate a digital payment system but the application was rejected by the Payment Systems Department of the central bank as due process was not followed in the application.
A senior official of the central bank, who has initial knowledge of the issue, said that EkPay applied to the central bank without following the proper rules, and it was rejected.
“Then we asked them, before getting the licence you should create a separate company and run the PSO on a limited scale but EkPay has failed to form a company till date,” he added.
“The payment system handles accounts linked with various banks. For this, you have to earn trust and responsibility but EkPay has no licence. So, central bank regulations did not permit the platform to maintain those accounts,” he continued.
When contacted, Bangladesh Bank Executive Director and Spokesperson Husne Ara Shikha said that EkPay took steps to obtain a licence from the central bank. It applied to the Bangladesh Bank for the issuance of No Objection Certificate (NOC) to continue the operation of payment system.
She said that prior to issuing a NOC, the central bank gave some instructions to operate the payment system in accordance with the regulations and the instructions are now being implemented.
And for this, the digital platform sought 120 days from the central bank, said Shikha.
In a written statement, the spokesperson said the platform is run under a ministry and for this reason, no risk was created.
The purpose of the digital platform is to manage transactions including utility bills, educational institutions’ fees and various government services’ fees and bills.
A senior PSO official said EkPay has been running a monopoly business of providing government services and the digital platform is illegally developed under a division of the government.
It is a service similar to Bangladesh Postal Department's 'Nagad'-style mobile financial service.
On condition of anonymity, an a2i official said that a total of four digital payment institutions, including EkPay and ekShop have been operating their services for the past few years under a2i programme and the government has been fixing the budget for those ventures every year.
Such kinds of initiatives were also planned for the private sector, he added.
The Agency to Innovate (A2i) Bill 2023 was passed in parliament in July 2023, but the a2i project has yet to turn into an agency and that's why EkPay didn't get a licence.
Mamunur Rashid Bhuiyan, additional secretary and project director of the a2i programme, said it was an innovative initiative under a2i and the central bank was aware of EkPay.
AKM Fahim Mashroor, a tech entrepreneur and co-founder and CEO of BdJobs.com and Ajkerdeal, said that laws and regulations were not maintained in many cases here.
The regulatory body could not do any work as the political issues were associated with it, he added.
He also said that since the digital payment is being managed under a ministry, the central bank could not bring it under any regulation like Nagad.
In this case, Bangladesh Bank should exercise its autonomy, he continued.
As EkPay monopolises business in case of payments of various government institutions, it has an impact on other PSOs.
