FinTech is the synergy between finance and innovative technology to meet the need for dynamic financial services with improved ability resulting in faster, reliable and low-cost financial services. The Financial service industry of Bangladesh is dominated by banking sector and supported by the government to foster competition between traditional and new banks to encourage alternative services for customers. However, it is not clear how banks are utilising their sensing and responding abilities under the FinTech-induced changing business environment.
During shopping for Eid-ul-Fitr 2019, a prominent attraction for the customers was the discount or cashback facility for making payment through FinTech services, especially bkash and NexusPay. A number of customers crowded the showrooms of different brands, especially Aarong, DeshiDosh, Handibazar, Apex, Bata, Easy, Lotto, Infinity, Ecstasy, etc. They provided discount or cash back of maximum 20 per cent and 30 per cent in collaboration with bKash and NexusPay respectively with a maximum limit of cash back on daily transactions and total transactions. But, did it make any significant impact on embracing the electronic payment systems by the customers? The research in this area is an urgent need.
A comprehensive survey has been conducted just after Eid-ul-Fitr 2019 on the adoption of electronic payment systems during Eid shopping taking into consideration 111 customers as respondents. Around 59 per cent of the customers were males and 41 per cent were females. The respondents belong to different age groups, especially in the age range of 20 years to 25 years. They consist of 51 per cent respondents as the young generation carried more weight during the survey. Nineteen per cent of the respondents belong to the age level of 26 years -30 years. The survey result demonstrates that most of the customers are still doing transactions with cash in spite of such attractive discount and cash back facilities of electronic payment systems. However, around 16 per cent of the customers made payment through bkash, maybe due to the cashback facility. Around 7.0 per cent customers used credit card. Few customers used the NexusPay maybe due to getting the maximum cash back facility. But, the use of debit card seemed significantly low during Eid shopping. During the last shopping, customers were aware of the availability of cash back or discount besides availability of quality products. Sometimes, they entered into some showrooms due to getting huge discount or cashback for making payment through electronic payment systems. According to the survey, around 31 per cent customers decided to enter into an outlet or showroom firstly considering the issue of discount or cash back for making payment through electronic channels whereas 69 per cent customers considered quality of products first.
Around 45 per cent of the customers made all payments through cash only. Nineteen per cent of the customers made 1.0% to 20% of the total payment during Eid shopping through electronic payment systems. Twenty-two per cent customers made 41% to 60% and 81% to 100% of the total payment through electronic payment systems. Around 14 per cent customers made 21% -40% and 61% -80% of total payments through electronic payment systems. Sixty-eight per cent of the customers did not have any app for making electronic payments. The most used app was bkash accounting for 24 per cent users. Around 5.0 per cent customers used the NexusPay and few customers used both the apps or any other app for making electronic payment. Customers under the survey suggested that banks offer more discount on credit card and introduce cash back on use of both debit card and credit card to encourage more payment through the electronic payment system. They think cash back and discount facilities are must for the debit cards and credit cards of banks as apps. They prefer to do shopping both online and at outlets but they think online shopping is convenient but not reliable. They suggest online purchases with cash on home delivery. Many customers feel comfortable to make payment through electronic payment systems but most of the payment systems are not available in the showrooms of their choice such as Dorjibari, Westeen, etc. They think that electronic payment systems should be available in all the outlets and the rate of discount or cashback should be same for all the electronic payment systems in all the outlets. Interestingly, some customers think that making payment through cash rather than electronic payment systems makes one concerned about the cash outflow.
As academic studies in FinTech services seem emerging in nature, the study will contribute to academic knowledge through enriching information systems and providing future research direction in the area of FinTech, an emerging topic in Bangladesh. Besides, the banking industry will benefit from the findings on how customers are responding to FinTech services.
The writer is Lecturer (Banking) of Leading University.