On the thirteenth floor of Nagad’s corporate office in Banani, everything from its calculated decor to the busy office-goers zooming in and out of big glass doors has an unmistakable air of efficacy.
Behind one of those doors sat Tanvir A Mishuk, the managing director of Nagad—which is often dubbed as a disruptor and trendsetter in Bangladesh’s ever growing mobile financial service (MFS) sector.
Mishuk’s spick and span appearance is imbued with the same vibe and energy as the office space surrounding him. His brisk, yet unassuming announcement to the Fintech Magazine team that he will be unable to give us a lot of time was expected and sensible from a person with his responsibilities.
The experienced investor and a visionary entrepreneur, however, ended up speaking in detail in answering our questions—an excerpt of which is presented here for our readers.
Fintech: Nagad has recently bagged the license of Nagad Finance PLC—a non-banking financial organization. What is the implication of this new venture? How Nagad will stand out in the crowded NBFI sector?
Tanvir A Mishuk: Whatever we have seen this far in last one decade is just the tip of the iceberg in fintech and we will now see the actual impact and boundless possibility through the changes. The deposit and advance market in Bangladesh is worth 150000 crore and we believe with our vision to cater small and medium scale businesses, we will be able to create a great impact.
“In the upcoming days, Nagad plans to make their services future-proof. As we are in the 4IR right now, we need to think according to the needs and requirements of this age. And Nagad will introduce services which will eventually assist the population of Bangladesh to adopt the cashless movement.”
Nagad however is equally excited about the future and very cautious about the responsibility. In terms of technology, we are bringing the technology that is never seen before in Bangladesh. A modern technology that will ensure safety and security of every customer that gets onboarded, changes and advancements through the regulator’s guidelines. We believe the power makes us more accountable on the responsibility of each Nagad users.
Fintech: Nagad has been able to grab a large chunk of MFS customers since its inception. How does it make it possible, considering the fact that Bangladesh’s common people are very reluctant in trusting new entrants in any sector?
Tanvir A Mishuk: If you are building a company in interest of Bangladesh people and people love you back because they can see the benefit and see the direct impact in their life. Nagad is the biggest testimony of that.
The vision for Nagad was to bring in a revolution in the financial industry of Bangladesh. To ensure financial inclusion for the unbanked masses of Bangladesh, MFS is a great solution. And to maximize its potential, Nagad was formed. We tried to understand the service gaps and issues which was hindering the adaption of MFS among the mass people and tried to design our services accordingly. We made account opening easy, digital transaction service affordable, and we worked relentlessly to ensure digitization of govt. stipend programs.
Although in Bangladesh, people are skeptical to accept a new entrant in any sector. But as we understood and tried to solve the financial pain points of the mass people, Nagad gained a special place in the heart of the people of Bangladesh. This is how Nagad has been able to gain a big market share in the saturated market.
Fintech: There are other MFS companies in the market. What is the unique selling point of Nagad? What makes it stand out among the rest?
Tanvir A Mishuk: There are lots of other MFS companies, but Nagad is being used nationwide, nonetheless. What makes us different is that we are very customer centric. People of Bangladesh are smart people; they could understand what is beneficial for them and because of that just after three years of operation we got a big chunk of MFS market. People who had alternate motives couldn’t stop us because of our vision has always been to bring the best for the people.
Our vision of financial inclusion brought some groundbreaking innovations that help people access financial services. Our app is very user friendly and even bar phone users can open an account through USSD. Besides that, we have kept all our service charges within the reach of mass people. Our cash out charge is the lowest and even our send money is free. The combined effect of Innovation and Affordability made us unique and so people preferred us to our competitors.
Fintech: MFS has created a revolution in Bangladesh and brought a huge chunk of unbanked population under financial services. Why do you think people have adopted MFS in such a quick time?
Tanvir A Mishuk: While the traditional banks are mostly concerned with the transaction of large amount of money, most of the transactions that happen daily are below Tk 1000 in Bangladesh. The services of traditional banking are not designed to cater such micro transactions. For that, MFS is almost a perfect solution for the mass people of Bangladesh.
It has enabled the people of all tiers of income to be included in a financial service where they can transact small amounts of 100, 200 to larger sums of money. MFS is a crucial solution for many, which people had been waiting for. Again we saw that, for a long time the MFS market was stuck where Nagad brought the innovation of Digital KYC and included a huge population with its innovation.
Fintech: The government as well as the regulator has long been talking about interoperability among the MFS. Why do you think it is not materialized yet? Where lays the impediment?
Tanvir A Mishuk: To ensure financial freedom for the MFS customers and give the boundless opportunity, interoperability is crucial. Currently this facility hasn’t been materialized due to several reasons. Primarily, there are still some technical difficulties to overcome in the overall system of MFS in Bangladesh.
On the other hand, the willingness of the operators and the agreement on the service charge for this service has also acted as impediments. Price point of interoperability should be such that the people belonging in the lower income tier of the society cannot afford and it becomes unfeasible. We need to agree to the fact that the interoperability should be initiated in such a way that everyone has the opportunity to avail it, in other words, the charge should be customer friendly.
Fintech: You have been named ‘Fintech Personality of the Year 2022’ by the UK-based Global Brands Magazine. How has this award motivated you to take the brand into a new level?
“To ensure financial freedom for the MFS customers and give the boundless opportunity, interoperability is crucial. Currently this facility hasn’t been materialized due to several reasons. Primarily, there are still some technical difficulties to overcome in the overall system of MFS in Bangladesh.”
Tanvir A Mishuk: Recognition and acknowledgement always feel good, but this title was particularly special to me because this signifies my contribution to the Fintech sector. I wholeheartedly thank Global Brands Magazine for this honor. After being named ‘Fintech Personality of the Year 2022’, I felt that I have the responsibility to do even greater things now. It motivated me to put my heart and soul into Nagad, and we can all see what Nagad has achieved in the past few months.
Fintech: What are the future potentials of MFS? What new areas it can serve? How does Nagad plan to adopt with the fourth industrial revolution?
Tanvir A Mishuk: Nagad, as well as other MFS companies has been operating in Bangladesh for more than 12 years. But in my opinion, the full potential of MFS is yet to be achieved in the scenario of Bangladesh. There a lot more that can customers do with MFS. It can be a 360 degree solution for all the financial requirements of everyone. Along with the transactions, people can use MFS for depositing micro amounts of money, take loans, making international transactions etc.
In the upcoming days, Nagad plans to make their services future-proof. As we are in the 4IR right now, we need to think according to the needs and requirements of this age. And Nagad will introduce services which will eventually assist the population of Bangladesh to adopt the cashless movement.
In the future, Nagad plans to deliver every financial solution from transactions to services across finance, insurance, and rewards programs using a combination of smartphone interfaces and data. Its aim is to create a Super-app by the fintech company to deliver highly tailored and relevant services through customer centric innovation.
Fintech: The task of bringing in a new MFS in the market must have been a challenging one. How did you motivate and lead your employees to achieve this feat?
Tanvir A Mishuk: It was very challenging, but I was determined to be successful. I always believed in my team; I knew they could overcome any challenge. When times got tough, we did not even think of stopping. I always told my employees,” We are doing this for our beloved Bangladesh, we have to do this.” I believe that this revolution of financial inclusivity for all is a long fight, and we need to build the path and walk through it.
Fintech: What has been Nagad’s impact in accelerating Financial Inclusion in Bangladesh?
Tanvir A Mishuk: Since its inception Nagad had one mission, that is to bring the Unbanked population of Bangladesh under a formal banking system. Given that more than 90% of the country’s population living in remote and rural regions and approximately 22% living below the poverty line, Nagad relentlessly strived to expand its distribution network and coverage.
When we entered the market, most of our population was unbanked. Financial inclusion was at the heart of our vision. To include the unbanked population into the system Nagad made financial services affordable, we even broke the monopoly that existed in the MFS market back then. We also make the customer journey as simple and smooth as possible. Right now, Bangladesh has a 55 percent financial inclusion rate, which is can be largely attributed to Nagad.
“Our vision of financial inclusion brought some groundbreaking innovations that help people access financial services. Our app is very user friendly and even bar phone users can open an account through USSD.”
Fintech: Is there any new feature or service Nagad plans bring in near future?
Tanvir A Mishuk: Currently Nagad is just a Mobile Financial Service. But we plan to be proper and complete Digital Financial Service. We are bringing new technologies for better user experience. In the future Nagad will be the National Wallet of our country and we will also build a Super App which will make people’s lives easier.
To assist in building an equal society in terms of access of digital transactions and payments, Nagad aspires to give the most accessible financial services to everyone, regardless of demographic differences, color and race distinctions. Nagad was founded to serve the people, and due to people’s unwavering support, it has garnered immense popularity in a relatively short period of time. And the process of onboarding will be continued so that every single person can have access to financial services anywhere and everywhere.
Fintech: Does Nagad have any plan of global scalability? I mean reaching out to other countries with its services?
Tanvir A Mishuk: Beauty of building technology that is executable in every phone and people gets benefitted immediately then your boundary is your entire world. Wherever there is demand and need you can just a game of plug and play. In recent years nine member countries of the APPU showed interest to replicate the business model of Nagad for the revival of their dying post offices.
There is so much to do Bangladesh and People of Bangladesh, the focus remains the same. My first and foremost duty is towards the people of Bangladesh and creates impact here and can replicate elsewhere. This is in our mind but honestly not today but in future who can stop such disruptive innovative technology to takeover and conquer the world.
