Salim Ahmed :
QR code is a payment system which can meet the demand of the time in all aspects of related parties. ATM withdrawal (without debit card), transport payment (UBER, OBHAI), e-commerce payment, physical store payment, restaurant bill payment, other bank transfer (RTGS), mobile top up, utility bill payment, insurance premium payment, payment of students fee, wallet to wallet transfer all’s are possible by QR code.
With QR, standing for Quick Response, is an “open source,” with a large data capacity, and can serve multiple uses such as storing contact details or digital payments. Each entity in the ecosystems is assigned a unique QR code. Individuals have them for their accounts and merchants have them for their stores. If we can adopt this payment system, so many costs and hazards of the banks will be avoided by increasing profitability in addition to financial inclusion. In case of QR code customer just scans the code in the mobile and respective apps automatically settle the payment in real time with the help of NPSB at minimum cost. QR code is revolutionary because of its adoption many cost will be obsolete forever to the related parties of the transaction.
In perspective of banks:
· Banks no more required to produce the plastic debit or credit cards rather scanned QR code replace the cards.
· Debit or credit card vendor management can be avoided along with cost.
· Courier charge can be avoided being bank will no longer collect and sent the Card and PIN separately.
· Waiting time for getting the card will be no more for both banks and customers, hence after opening the account customer need not to wait 10-15days to start transaction which will minimize customer service lead time.
· Currently one employee manages the card and another employee manages the security PIN. If QR code replaced the card, it will be produced from system and goes to the customer without physical involvement. It reduces two employees responsibility.
· Banks will not produce the paper based secret PIN for their clients anymore which will saves a lots of paper and stationary.
· Card department can run with minimum employee size being vendor management, ordering, collection and distribution of the cards will no more physically exists.
· Banks need not to provide any POS machine to the merchants instead a QR code is enough to do prospective transaction. Hence a huge volume of cost for acquiring POS machine that incurred in today’s banking will be obsolete with the introduction of QR code as a payment method.
· Banks may think QR code as an alternative of paper based check book being QR code itself gives the transaction facility or can use check above a threshold transaction like TK.2-3.00 lac.
The customer or account holder will be benefited from QR code based banking based payment system.
· Clients will not take debit or credit card at any cost.
· Clients can save or avoid annual fee, renewal fee, reissue fee which ranges from TK. 345-TK.575 in different banks.
· No need to carryout additional card physically.
· No need POS (Point of Sales) to purchase any goods or services rather QR code is enough.
· Customer can avoid check book cost if QR code can replace the check book
· Customer gets anytime, anywhere transaction facility with the help QR code
Merchant is the big part of this process being transaction of goods and services routed through this point. QR also changes the merchant’s transaction process.
· POS machine will be obsolete. Merchant will no more use any POS machine rather QR code replace it.
· In existing POS system merchant have to wait minimum three days (T+2=3) to get the fund after banks reconciliation and commission adjustment. But in QR code payment system it will be real time transaction without any delay or maximum one day is enough to settle the transaction.
· Buyer and seller have real time transaction.
· Earlier no card no transaction but in this process a person can do transaction without Card just by having a scanned QR code only.
· Internet or wireless connection is must for POS based transaction. But in QR code system not both party rather only one party needs to be connected with net for completing the transaction hence its easier and cost effective. Just with a QR code a customer even from village can do transaction without having smartphone and internet facility.
Traditional order management of sales person already converted into QR code system. For example, earlier a sales person of PRAN Company collects order from all retail stores by writing in paper and end of the day after returning to office he accumulated whole days order then placed to the production or warehouse. But today PRAN Company issues QR code for all its retail stores and fixed up in front of the store. When sales person comes to the store, he just scans the QR code into his mobile, write the orders which instantly sent to the production or warehouse for delivery. But collection is still in old fashion. Collection man goes store to store for collecting sales proceed in cash physically. At day end he has to accumulate and deposit it to company’s bank account which is completely manual and time consuming.
Bank can take this opportunity by giving collection facility by integrating with the existing QR code order management system. Already FMCG (Fast-Moving Consumer Goods) companies and their retail stores are accustomed with QR code. Now there should have a corporate agreement between bank and FMCG companies that their retail stores will open QR code based account with bank.
In a nutshell banks can avoid check book cost, debit card cost, paper passed PIN cost, less employee involvement but faster and more accurate service can be ensured. Besides, it’s not possible to go every village by a bank to gives banking facility but a QR code can. Even smartphone is not mandatory for QR code transaction. As financial inclusion is incomplete without marginal people’s involvement, hence village or marginal people can easily enjoy banking facility with the help of it. We can follow the example of China’s Alipya, WeChat payment eco-system. Over there payment goes outside the banking channel but I think it will be more trusted, regulated, benefited and actual financial inclusion can be done if QR code transaction can be routed through banking channel in our country.
To encourage and guide this process Bangladesh Bank should come forward to hear the opinion of bankers, experts, economists, Compliance personnel, technology expert to sketch the blue print, find out the challenges and way of removal.
(Mr. Salim is a banker and analyst. Email: [email protected])
