Mobile banking services rip off users, says former governor Farashuddin

Former central bank chief Mohammed Farashuddin has come down hard on mobile money and said the fund transfer services without a proper regulatory framework opened scope for “looting”.

Sharing his experience with an audience at the the Anti-Corruption Commission’s founding anniversary in Dhaka, he alleged that the service providers are ripping off the people.

“They charged me 2 percent of the amount I transferred into a teacher’s account in Bogra and they have charged for the fund withdrawal as well,” he said on Tuesday.

“We are adopting technological advancement without a framework. I condemn this mobile fund transfer, which is called mobile banking.”

“There’s nothing to do about it since there’s no regulatory framework,” the former governor said adding fund transfer through banks costs 0.5 percent.

Bangladesh has embraced a market economy without a regulatory framework, which may lead to growth, but will fall short of expectations, he said.

“The corrupt and looters are more active than ever as soon as we entered a market economy. And it all leads to the absence of regulations,” said Farashuddin.

The former bureaucrat, who also served as member of the Planning Commission, rapped the government for not taxing e-commerce. “I have been saying it for the last five years.”

Criticising the move allowing individuals to bring in funds as loans from abroad, he said it will weaken the taka.

“Bangladesh Bank’s reserve stand at $33 billion now, a devaluation is bound to happen,” Farashuddin said adding when it happens it will be a massive one.