ISLAMABAD: Pakistan Telecommunication Authority (PTA) has not yet issued a commencement certificate to Virtual Remittance Gateway (VRG) for commercial operational for Asaan Mobile Account (AMA) scheme.

On 14th August 2020, Virtual Remittance Gateway (Pvt) Ltd through advertisements claimed that it is "Commercially operational for Asaan Mobile Account (AMA) Scheme with Jazz and SCO."

The PTA has stated that in the larger public interest, it is clarified that the PTA has not yet issued a commencement certificate to VRG for commercial operations of the AMA Scheme in Pakistan.

Further, for the AJ&K and GB, VRG has even not been awarded any Third Party Service Provider (TPSP) license.

The general public is advised not to undertake any commercial activity till all the license conditions for the commercial launch of the AMA Scheme have been met by VRG as per the TPSP License.

The PTA has already directed VRG to immediately stop commercial operations in relation to the AMA Scheme until the authority issues a commencement certificate to the VRG.

Muhammad Salman Ali, chief operating officer (COO) at the VRG in an exclusive talk with Business Recorder recently claimed that all is set for the commercial launch of the AMA Scheme, after getting due clearance from the State Bank of Pakistan (SBP) and the PTA, which would play a vital role in financial inclusion, digital payment and documenting the informal economy.

"After the pilot project, VRG operated AMA Scheme for four months and completed its successful soft launch under the monitoring of Regulators (SBP, PTA)," said Ali, adding that VRG had obtained required clearance for commercial launch of the scheme, which was expected soon.

As per the SBP data, around 23 percent population is financially included, which is lowest in the region and one of the hurdles in economic growth.

However, scheme like the AMA is envisaged transferring millions of un-banked to financial inclusion by providing digital payment at around 100 times lower rate compared to the current schemes run by telecom operators.

There are different models of branchless banking industry, which are prevalent globally.

In Pakistan, the One-to-One model, ie, One Bank to One Telecom Operator is well-known.

The major mobile financial services (MFS) players have strong telecom partnerships and investments, which enables an already extensive franchisee network to operate as an agent network.

Through this oligopoly they have covered significant ground in financial inclusion, but prevented other banks to enter the marketplace.

This is the reason why the big five resorted to a telco-agnostic model.

The AMA Scheme is an ANY-to-ANY model, it opens new avenues for existing MFS players to compete and offer services to subscribers of other telecom operators through their banks, and provides all branchless banking players with a level-playing field to enter the space, while existing players will have the opportunity to gain customer base from other mobile networks and banks.

Subsequently, the consumer would be the one benefiting the most, as it would introduce a plethora of financial and non-financial services to choose from.

The AMA Scheme platform is an amalgamation of two industries and is a three-step process.

"First, we interconnected with the USSD Gateway of all Telecom operators to route all AMA traffic towards VRG. Our platform connects this with our core system, which hosts banking menus and services offered by banks. The USSD app processes all incoming requests from telecom subscriber handsets into an interactive session where the customer can navigate menus to use services and provide necessary details, such as entering a beneficiary account number during a funds transfer. For the third and final step, we have integrated with all branchless banking banks, to which we route all such subscriber's request to be processed into financial transactions," he added.

Copyright Business Recorder, 2020

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