Project on Bkash

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Letter of Transmittal
12th August 2014
Mohammad Hannan Miah
Faculty Member
School of Business
North South University
Baridhara, Bashundhora, Dhaka
Dear Lecturer Mohammad Hannan Miah,
We would like to present our term paper, STRATEGIC MANAGEMENT on bKash.
While preparing this term paper we had learned and acquired so many knowledge on
strategic management. We had also learned about teamwork, writing, observing, analyzing
and most importantly how to sketch a business’s strategies, which they apply on their
business to achieve their goals. It was highly exhilarating and appreciable task, assigned for
us, we were greatly inspired, though we have faced hundreds of obstacles, while working on
this term paper.
Thank you for guiding us and giving us an opportunity to demonstrate our potentials, talents
and skills on Strategic Management.
Sincerely,

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Acknowledgement
21st April 2014
Mohammad Hannan Miah, Faculty Member, NSU
Dear Sir
We would like to give the vote of appreciation to your huge pull up and motivation to us,
which made us complete such term paper in MGT489 course. As a hole we would like to
thank you from our inner core of heart. Without your inspiration and efficient knowledge
sharing we may not be able to finish our work in such manner.
Thank you again for your continuous trust on us and made us do the paper properly, all credit
is yours.
Respectfully yours,

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Contents
Executive Summary.................................................................................................................13
Introduction..............................................................................................................................14
About the Company.................................................................................................................16
Mission.....................................................................................................................................16
Vision.......................................................................................................................................17
Why we have chosen this company .........................................................................................17
Purpose.....................................................................................................................................18
Which Industry it Belongs to ...................................................................................................19
Industry Analysis .....................................................................................................................21
Stages in the Industry Life Cycle.........................................................................................21
Industry Growth Analysis (Past six months) .......................................................................21
Industry structure .................................................................................................................26
..............................................................................................................................................26
Controlling force for the profitability and industry profitability .............................................27
General Environment Analysis ................................................................................................28
PESTLE Analysis ................................................................................................................28
Political ............................................................................................................................28
Economic .........................................................................................................................29
Social................................................................................................................................29
Technology.......................................................................................................................30

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Legal.................................................................................................................................31
Competitive Environment Analysis.........................................................................................34
Porter’s 5 Forces ..................................................................................................................34
Threat of New Entrants - Low (Positive/Favorable)........................................................34
Bargaining Power of Suppliers - High (Unfavorable/Negative)......................................36
Threat of Substitute Services - Moderate.........................................................................38
Bargaining Power of Buyers – Moderate.........................................................................39
Competitive Rivalry – High.............................................................................................40
How Macro-Environment is Affecting The PORTER’S Five Forces? ...............................43
3 I Analysis: .........................................................................................................................46
Immediate Competitors:...................................................................................................46
Impending Competitors: ..................................................................................................47
Invisible Competitors:......................................................................................................47
SWOT Identification................................................................................................................48
Business canvas and the current Model of bKash ...................................................................51
A. Key Partners ..............................................................................................................51
B. Key Activities............................................................................................................52
C. Key Resources...........................................................................................................54
D. Value propositions.....................................................................................................56
E. Customer Relationships.............................................................................................59
F. Channels........................................................................................................................62

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G. Customer Segments...................................................................................................64
H. Cost Structure............................................................................................................65
I. Revenue Streams...........................................................................................................66
Current Business Model of bKash...........................................................................................68
Core competency of bKash......................................................................................................70
Corporate level strategy...........................................................................................................71
Diversification- Related linked Strategy..............................................................................72
Strategic Alliances ...............................................................................................................72
Strategic Outsourcing...........................................................................................................72
Corporate level strategies of bKash and its mission- The relationship....................................73
Corporate Risk Management ...............................................................................................73
Increased Scope of operations..............................................................................................74
bKash Activates International Remittance Facilities .......................................................74
bKash Facilitates in Brac Microfinance...........................................................................74
Increased Efficiency.............................................................................................................75
Performance Management System among Employees and Agents.................................75
Business level Strategies..........................................................................................................76
Key Issues of Business Level Strategies..............................................................................76
Who will be served?.........................................................................................................76
What needs to be satisfied?..............................................................................................77
How those needs to be satisfied? .....................................................................................77

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Five Generic Business Level Strategies...............................................................................78
Competitive Positioning and the Value Creation Frontier...................................................79
Product Life Cycle ...............................................................................................................80
ANSOFF Matrix ..................................................................................................................81
The BCG Matrix ..................................................................................................................82
Business level strategies helping to achieve Corporate level strategies ..............................82
Functional Level Strategies......................................................................................................83
Divisions and Departments of Bkash...................................................................................84
Management Division..........................................................................................................84
Corporate Strategy and Decision making Wing ..............................................................84
Corporate Affairs .............................................................................................................84
Brand................................................................................................................................84
Service development and Management ...........................................................................85
Corporate Sales ................................................................................................................85
Marketing Division..............................................................................................................85
Product development team...............................................................................................85
Media Team .....................................................................................................................85
Creative Team..................................................................................................................86
Marketing Strategies ............................................................................................................86
Marketing Mix .....................................................................................................................87
Product .............................................................................................................................87

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Price .................................................................................................................................88
Place.................................................................................................................................88
Promotion.........................................................................................................................88
People...............................................................................................................................89
Process .............................................................................................................................89
Physical Evidence ............................................................................................................91
Productivity and Quality..................................................................................................91
Finance Division..................................................................................................................92
Central Accounts..............................................................................................................92
Costing and Factoring......................................................................................................92
Revenue Assurance..........................................................................................................92
Taxation ...........................................................................................................................92
Human Resource Management ............................................................................................92
Things bKash Does to Attract Top Quality Management ...............................................93
Employment Opportunities and Facilities of bKash........................................................93
Some Terms of Employment at bKash ............................................................................93
Information Technology Division........................................................................................96
Security Strategy..............................................................................................................96
Network Coverage ...............................................................................................................97
Linking the Resources, Core Competency, Capabilities with Functional Level Strategies for
Value Creation .........................................................................................................................97
Company Structure and Control System................................................................................102

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Division & Departments: ...................................................................................................102
a. Commercial Division: ................................................................................................102
b. Finance and Accounts Division: ................................................................................102
c. Corporate Affairs & Legal: ........................................................................................102
d. Human Resources: .....................................................................................................103
e. Technology:................................................................................................................103
f. Administration:...........................................................................................................103
h. Customer Service Division: .......................................................................................103
Corporate Governance ...........................................................................................................109
Shareholders.......................................................................................................................110
Auditors..............................................................................................................................110
External Auditor.................................................................................................................111
Company Structure and Control System........................................................................112
Personal control: ................................................................................................................113
Output control: ...................................................................................................................113
Behavior Control................................................................................................................114
Value chain analysis...............................................................................................................116
Social innovation................................................................................................................116
Bringing mobile top-up service: ........................................................................................117
Affordable Services............................................................................................................117
Nationwide Coverage.........................................................................................................117

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Brand Image.......................................................................................................................118
Primary Activities ..............................................................................................................118
Support Activities ..............................................................................................................119
Strategic Analysis (4P)...........................................................................................................120
Position...............................................................................................................................120
Priorities.............................................................................................................................120
Payments ............................................................................................................................121
Performance .......................................................................................................................121
SWOT Analysis .....................................................................................................................122
Strengths.............................................................................................................................122
Weaknesses ........................................................................................................................123
Opportunities......................................................................................................................124
Threats................................................................................................................................125
Proposed Business Model......................................................................................................126
Strategic Alliance:..............................................................................................................126
II. Micro-Finance Institutes................................................................................................127
III. Developing new Products/Services: ............................................................................128
Conclusion .............................................................................................................................130
Recommendation ...................................................................................................................131
Corporate Level Strategies:- ..............................................................................................131
Business Level Strategies:- ................................................................................................132

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Functional Level Strategy:-................................................................................................133
References..............................................................................................................................135
Appendix…………………………………………………………………………………...138

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List of Figure
Figure No. Page Number
Figure 1 22
Figure 2 23
Figure 3 25
Figure 4 27
Figure 5 29
Figure 6 35
Figure 7 44
Figure 8 49
Figure 9 50
Figure 10 71
Figure 11 70
Figure 12 78
Figure 13 79
Figure 14 80
Figure 15 81
Figure 16 82
Figure 17 83
Figure 18 102
Figure 19 117
Figure 20 130

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List of Tables
Table No. Page Number
Table 1 23
Table 2 25
Table 3 34
Table 4 42
Table 5 51
Table 6 52
Table 7 89

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ExecutiveSummary
The purpose of our project is to analyze the strategic management of bKash to have a clear
understanding on how the company is affected by the external and internal environment and
the different strategies the company is pursuing right now and what should be done to
overcome the challenges the company faces. We, as a team have worked equally over the
three months to perform an in depth analysis of the various issues of the company. The
project seeks to find out how bKash is performing compared to the competitors and the main
objective is to find out the strategies the company is pursuing and what needs to be done to
improve those strategies so that they can become the market leader. Through the project, the
major findings include the different strategies the company is pursuing, their control and
structure system, corporate governance mechanisms, effect of macro-environment forces,
internal analysis of the company and through these analysis we have tried out to find out the
problems of the company and what should be done to overcome them like in the corporate
level strategy, business level strategy and functional level strategy. The project also
represents a new business model, which the company can adopt to enhance their core
competency and value proposition and thus achieving competitive advantage. Major
recommendations include company Can implement tapper integration, create more strategic
alliances, pursue product development strategy, implement cash management system, overall
system improvements, strengthening the overall security system and educating the rural
customers on bkash through mobile retailers. Throughout the project we faced many
problems such as lack of communications between the company and the group members.
Time frame was still not enough as there were plenty of other works too with added courses.
Finally by delivering this project, we seek to improve the current position of the company so
that it can help them to gain their mission, which is to become the number one mobile
banking brand in Bangladesh.

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Introduction
Banking system in Bangladesh has gone through many sweeping changes in the lapse of
time. It has been shaped by economic as well as political philosophies. The growth and
evaluation of financial system of Bangladesh since liberation can be clearly viewed. Since
then the banking sector of Bangladesh experienced different kinds of changes. With the help
of the combination of two most recent technological advancements – internet and mobile
phone, banks of Bangladesh introduced a new service which is known as “Mobile Financial
Services” and thus it gave birth to a new industry which is known as “Mobile Banking
Industry”. Mobile banking refers to a system that enables bank customers to access accounts
and general information on bank products and services through a Mobile device. Banking
through mobile phone has been common in developed countries for years. The real potential
of “m-banking” may be to make basic financial services more accessible to millions of poor
people. Therefore, this mobile banking industry is significantly in favor of the rural areas
compared to the urban areas. There are around 160 million people in Bangladesh, of which
only 13 percent have bank accounts where as more than 95 percent are mobile phone users.
Banks can now offer the banking services to rural and unbanked population through mobile
phone.
Mobile Banking is new in our economy. Only a few banks are now offering this service.
Through Internet Banking most of the banks are offering only balance information. Actual
fund transfer and fund disbursement is not possible in all the banks that are offering internet
banking services. So this product will enjoy the benefit of a first mover. It is cheap both for
the banks and the customers. The bank will be able to lower down the overhead costs and
make more profit out of it. The customers will be able to save time as well as money for their
transaction needs. Many poor people already have access to mobile phones. A positive aspect
of mobile phones is that mobile networks can reach remote areas at low cost. The poor often

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have greater familiarity and trust with mobile phone companies. Mobile banking industry
acquires a great opportunity in the future. Mobile device is becoming very common in
Bangladesh. So a service offered through the mobile phone will be widely accepted in the
near future. Mobile banking or m-banking facilitates mobile phone users to access
fundamental financial services even when they are miles away from their nearest branch or
home computer. This financial service is emerging as a vital and contemporary tool for
financial inclusion with the intent to alleviate poverty and uphold the standard of life
worldwide, particularly in the emerging and developing countries. In many parts of the globe,
such as the Philippines, Brazil, India and Africa, mobile financial services are tremendously
flourishing. In Bangladesh bKash, a concern of BRAC has stared the mobile financial
service jointly with the telecom service providers Grameenphone and Robi which will take
the financial inclusion strategy adopted by Bangladesh Bank, the central bank of Bangladesh,
to the next stage through m-banking. Moreover, other telecommunication service providers
will be integrated in the platform to enhance the m-payment services in near future. Some
other banks are delivering the m-banking or m-money services through the Banglalink and
Citycell cellular operators to bring poor people from remote areas under smart banking
service.

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About the Company
bKash Limited, a subsidiary of BRAC Bank, started as a joint venture between BRAC Bank
Limited, Bangladesh and Money in Motion LLC, USA. The ultimate objective of bKash is to
ensure access to a broader range of financial services for the people of Bangladesh. It has a
special focus to serve the low income group of the country to achieve broader financial
inclusion by providing services that are convenient, affordable and reliable.More than 70% of
the population of Bangladesh lives in rural areas where access to formal financial services is
difficult. Yet these are the people who are in most need of such services, either for receiving
funds from loved ones in distant locations, or to access financial tools to improve their
economic condition. Less than 15% of Bangladeshis are connected to the formal banking
system whereas over 68% have mobile phones. These phones are not merely devices for
talking, but can be used for more useful and sophisticated processing tasks. bKash was
conceived primarily to utilize these mobile devices and the omnipresent telecom networks to
extend financial services in a secure manner to the under-served remote population of
Bangladesh.
Mission
By providing financial services that are convenient, affordable and reliable, bKash aims to
widen the net of financial inclusion. bKash wants to provide a solution for Mobile Financial
Services, built on a highly scalable Mobile Money platform, allowing the people of
Bangladesh to safely send and receive money via mobile devices.

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Vision
The ultimate objective of bKash is to ensure access to a broader range of financial services
for the people of Bangladesh and also to empower the unbanked people.
Proposed services and product of bkash:
 cash in
 cash out (from agent, from ATM)
 send money
 payment
 Buy airtime etc.
Why we have chosen this company
Earlier this century, the mobile phone became the first communications technology to have
more users in developing countries like Bangladesh. With the combination of two most recent
technological advancements – internet and mobile phone, a new service (mobile data service)
is thus enabled and the first such wireless internet commercial transaction is performed by the
banking industry. Banking through mobile phone has been common in developed countries
for years. The real potential of “m-banking” may be to make basic financial services more
accessible to millions of poor people. Bangladesh, home to 165 million people, represents a
unique opportunity for a mobile money platform: universal wireless network coverage,
widespread personal ownership of mobile phones, a cash economy, poor physical
infrastructure, and a favorable regulatory environment for a bank-led initiative. bKash
presents a compelling business plan and social uplifting agenda which capitalizes on these

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factors to dramatically expand access to formal financial services for the people of
Bangladesh, less than 10% of them so far have encountered any formal banking facility.
After the central bank advocated for mobile operators and microfinance organizations to be
its active partners and has provided 10 licenses to banks to offer the full range of mobile
financial services it allowed a way for Mobile Financial Services (MFS) which is an approach
to offering
financial services that combines banking with mobile financial wireless networks which
enables users to execute banking transactions and thus bkash emerged in by late 2011 and
into 2012. We have chosen this company because we wanted to study how bkash paved a
way for mobile banking industry as well as mobile financial services in Bangladesh.
Moreover, we wanted to find out what are the strategies that they use to sustain in the
competitive industry, what are their core competencies and do a research on the industry that
it belongs to.
Purpose
Bkash has branded itself as the world's second successful venture, having stronger customer
base in Bangladesh is now in position to exceed 'the most successful mobile financial service
provider'. After getting the license and approval from the central bank for offering mobile
banking services, Bkash (BRAC Bank) gained competition from several banks that also
started offering mobile banking services. Those banks are: Trust Bank, Mercantile Bank,
Dutch Bangla Bank, Bank Asia, making Dutch Bangla bank the biggest competitor of Bkash.
We have chosen this company because we wanted to study how bkash paved a way for
mobile banking industry as well as mobile financial services in Bangladesh. Moreover, we

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wanted to find out what are the strategies that they use to sustain in the competitive industry
and also to safeguard their business. And also what are their core competencies and do a
research on the industry that it belongs to.
Which Industry it Belongs to
Bkash belongs to the industry of mobile banking or mobile financial service also known as
“M- Banking”. It is a part of country’s financial system and the industry aims to enable
individual to enjoy some of the banking services such as payment, fund transfer etc from their
mobile phone. Bangladesh Bank is the sole regulatory body and this industry is closely linked
to the banking industry of the Bangladesh. However, innovative as well as sophisticated
process of the service has added a new dimension in financial service. Hence, it has created a
new industry in Bangladesh. From the inception of bKash, the company aimed to reach the
zenith in M- banking industry.
Mobile banking or mobile financial service is mainly dominated by the banks operating in
Bangladesh. The major players of the industry are BRAC Bank(Bkash) Limited, Dutch
Bangla Bank Limited, Marcantile Bank Limited, Islami Bank Bangladesh Limited, Bank
Asia, Mercantile Bank limited. The industry consists of twenty eight licensed banks and
twenty of them started their operation.
Mobile financial service is a Bangladesh Bank’s initiative to execute financial inclusion of
the people who do not have access to traditional banking services. The aim the industry is to
provide banking service to 115.627 million mobile phone users of Bangladesh. The targeted
customer group is rural people who can enjoy banking facility via using their mobile phone.
The key suppliers of this industry are the mobile phone network operators. Currently there
are six network operators in Bangladesh and they are Grameen phone limited, Banglalink

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Digital Communication Limited, Robi Axiata Limited, Airtel Bangladesh Limited, Pacific
Bangladesh Telecom Limited (Citycell) and Teletalk Bangladesh limited. Among them
Grameen Phone holds the top customer base and followed by Banglalink, Robi, Airtel,
Citycell and Teletalk. Another major supplier is the IT companies who support or manage the
IT systems of the companies and vendors of IT system consists of both foreign and local
entitites. Funding is one of the major concerns for any financial service provider. In mobile
banking industry of Bangladesh there are foreign investors, general public (deposits), parent
banks, and non deposit borrowing are available for funding the service.
Traditional banking service and micro finance service industries are major competitors of the
industry. Since banking industry is at mature stage in Bangladesh, mobile financial service
industry struggling to attain the financial service market of Bangladesh. Cross boarder
transaction service companies (such as Western Money Union) are also major competitor of
mobile financial service industry.
The major substitutes for mobile banking can be credit and debit cards issued by banks,
online transaction services, payment by checks, cash payment. Unofficial and non-regulatory
payment services are also potential substitutes for this service.
In Bangladesh there are 56 scheduled banks operating in banking industry and 28 of them had
been approved to operate mobile banking service. Currently 20 out 28 approved banks have
started their operation. Remaining banks are very likely to enter in the industry. Moreover,
above 30 non banking financial institutes and mobile phone operators are also potential
entrants of the industry.

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Industry Analysis
Stages in the Industry Life Cycle
Figure 1: Stages in the industry life cycle
The mobile banking industry is currently in the growth stage with huge potential for
companies to increase their sales and capture market shares. With 60% of the total population
have access to cell phones; people are more and more willing to conduct their financial
transaction through mobile banking. Total 46.26% of financial transactions were conducted
through mobile banking, indicating a growth in the number of people that are aware of
mobile banking and are using it as a means of making payments for various forms of
transactions. The number of active accounts saw a peak in terms of growth in November
2013, at 41.22%. Another source of mobile banking transaction is inward remittance coming
into the country. The inward remittance increased from 29.18% to 38.43% in the time span
from 2013 to 2014 despite different turmoil situation around the country.
Industry Growth Analysis (Past six months)
In this section we will be analyzing the growth potential of the mobile banking industry. The
section is divided into two parts, and with the help of bar charts and addressing key

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components, we look to investigate and interpret the mobile banking industries growth and as
well as service activity growth in the sector from November 2013 to April 2014.
Figure 2: Industry Growth Analysis
Table 1: Industry Growth
Description
Novembe
r, 2013
Decembe
r, 2013
Janurary
, 2014
February,
2014
March,
2014
April,
2014
No. of approved Banks 0% 0% 0% 0% 0% 0%
No. of Banks started
to
convey the service 0% 0% 0% 0% 0% 5.26%
No. of agents
16.75% 9.96% 10.69% 23.35% 13.81%
11.13
%
No. of registered 15.70% 14.16% 6.05% 4.59% 2.77% 2.12%
-0.3
-0.2
-0.1
0
0.1
0.2
0.3
0.4
0.5
Industry Growth
No. of approved Banks
No. of Banks started to
convey the service
No. of agents
No. of registered clients (lac)
No. of active accounts (lac)
No. of total transaction
Total transaction in taka (crore BDT)
No. of daily average
transaction
Average daily transaction in taka
(Crore BDT)

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clients (lac)
No. of active accounts
(lac) 41.22% 13.36% 7.56% 4.96%
-
19.73%
-
2.77%
No. of total transaction 13.71% 17.07% 6.00% -12.70% 14.95% 7.23%
Total transaction in
taka (crore BDT) 8.59% 20.04% 7.62% -8.60% 20.12% 3.14%
No. of daily average
transaction 13.72% 17.07% 6.00% -12.70% 14.95% 7.23%
Average daily
transaction in taka
(Crore BDT) 8.59% 20.04% 7.62% -8.60% 20.12% 3.14%
In the first part we assess the mobile banking industries’ growth potential by analyzing key
components; such as: Number of approved banks, Number of Banks that have started to
convey the service, Number of registered clients, Number of active accounts, Number of total
transaction, Total transaction in taka, Number of daily average transaction, Average daily
transaction in taka.
Over the period of six months, from November 2014 to April 2014, the aggregate growth of
mobile banking industries’ components were: Number of existing banks: 5.26%, Number of
Agents: 85.69%, Registered Clients: 45.39%, Number of active clients: 44.6%, Number of
Total Transactions: 46.26%, Total Transactions in taka: 50.91%, Number of daily average
transactions: 46.27%, Average daily transaction in taka: 50.91%.
The 85.69% growth in the number of agents shows that there is demand for mobile banking
which has prompted banks to expand the number of agents available to service customers.
The number of clients that registered over the six month period grew by 45.39% and number
of active clients stood at 44.6% indicating that people were actively using mobile banking
services, not just registering for one time use. The number of total transactions has seen
growth of 46.26% and total transactions in taka (crore BDT) has grown by 50.91% from
November 2013 to April 2014, highlighting the fact that mobile banking is being used as a

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means of making payments for various forms of transactions and the industry still has room
to grow.
Figure 3: Activity Growth Analysis
Table 2: Activity Growth
Description
November,
2013
December,
2013
January,
2014
February,
2014
March,
2014
April,
2014
Inward Remittance -17.51% 29.18% -5.95% -38.43% 15.60% -5.52%
Cash In transaction 7.81% 19.82% 7.55% -8.46% 23.34% 2.97%
Cash Out Transaction 10.80% 18.98% 6.62% -9.67% 18.20% 1.10%
P2P transaction 21.04% 21.79% 8.61% -8.86% 16.52% 3.68%
Salary Disbursement
(B2P) -34.08% 59.10% 3.81% -12.91% 26.71% 35.04%
-200.00%
-100.00%
0.00%
100.00%
200.00%
300.00%
400.00%
500.00%
600.00%
Activity Growth
Inward Remittance
Cash In transaction
Cash Out Transaction
P2P transaction
Salary Disbursement (B2P)
Utility Bill Payment ( P2B)
Others

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Utility Bill Payment 52.38% 156.88% 488.81% 140.29% 25.18% 56.79%
Others -82.20% 27.46% 3.63% -21.60% 2.68% 22.39%
The second part of this section looks at growth in the level of activity in the mobile financing
sector over whole of Bangladesh by analyzing the following: Inward Remittance, Cash In
Transaction, Cash Out Transaction, Person-2-Person Transaction, Salary Disbursement
(Business-2-Person), Utility Bill Payment (Person-2-Business) and Others.
Over the period of six months, from November 2014 to April 2014, the aggregate growth of
mobile banking activities were: Inward Remittance: -22.63%, Cash in Transaction: 53.03%,
Cash out Transaction: 46.03%, Person-2-Person Transaction: 62.78%, Salary Disbursement
(B2P): 77.67%, Utility Bill Payment (P2B): 920.33%.
So, apart from Inward Remittance we can see that all the other components saw substantial
growths. The decline in Inward Remittance can be attributed to the various foreign factors,
such as not as many workers are going abroad for employment, as well as several more
workers returning from Middle Eastern countries like Saudi Arabia through “diplomatic
channels”1. The 53.03% and 46.03% growth in Cash in Transactions and Cash out
Transactions, respectively, shows that mobile banking is being used as a medium to make
payment for basic transactions. The growth in Person-2-Person transaction by 62.78% shows
mobile banking is increasingly being used to make private transactions among individuals as
well as to send money across districts within the country. Businesses have also started using
mobile banking as a means to pay remunerations and salaries to their employees as Salary
Disbursements made through mobile banking over the six month period rose by 77.67%. And
finally the sector that saw the most growth was Utility Bill Payments made using mobile
1 Hussain, Z. (2014, January 12). Explaining the Recent Decline in Remittances in Bangladesh. End Poverty in
South Asia. Retrieved June 8, 2014, from http://blogs.worldbank.org/endpovertyinsouthasia/explaining-recent-
decline-remittances-bangladesh

26
banking, which saw an astronomical growth, aggregating to 920.33% over the six month
period, as people are switching to mobile financing services to pay their bills rather than
standing hours in line.
Industry structure
Oligopoly: The current industry structure of mobile banking or mobile financial service is
oligopoly. Very limited numbers of service providers, high entry barriers, and little scope of
differentiation in service have formed an oligopoly market in mobile financial services. The
players of this industry are mostly banking corporations with sound financial background and
in Bangladesh there is limited number of banks has the approval to provide this service. Entry
Barriers such as huge capital requirements, strict rules & regulations, incumbency advantage,
unequal access to distribution channel, economies of scale and retaliation from existing firms
have made it difficult for new firms to enter the industry. In a oligopoly market the product or
service may or may not be differentiated and there is little scope of differentiation for mobile
Perfect
Competetion
Monopolistic
Competetion
Oligopoly
Monopoly
Figure 4: Industry Structure

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financial service. Therefore, mobile financial service or mobile banking industry structure is
currently oligopoly.
Controlling force for the profitability and industry profitability
Controlling forces for profitability for the mobile banking industry in Bangladesh are;
 Network Quality of Telecom Companies
 Usages of services
 Efficient Banking Service
 Value added services
 Customer satisfaction
 Cost and time Efficient
 Government rules and regulation
Industry profitability includes major key points like:
 Customer base
 Growth of the country
 Customer demand and usage
 Government rules and regulations
 Role of network providers (suppliers)
 Advancement of technology in the country

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PESTLE
Political
Economic
Social
Technological
Legal
Environmental
General Environment Analysis
PESTLE Analysis
PESTLE stands for "Political, Economic,
Social, Technological, Legal and
Environmental" and is used for business
and strategic planning, marketing planning,
organizational change, business and
product development and research reports.
By understanding these external
environments, organizations can maximize
the opportunities and minimize the threats to the organization.
Political
Political factors have a positive effect on the industry.
Political stability is rare in Bangladesh. Internal disputes between political parties always
create a pressure on the economy while halting the growth rate in every sector and of Mobile
Financial Services (MFS) sector can never be an exception. Despite the unfortunate
condition, mobile banking industry has surpassed the hindrance by the political irregularities
and has been able to make its mark in the market by the running fourth year. Because of the
pro-active and forward-looking approach of the Bangladesh Bank and Government, mobile
Figure 5: Pestle Framework

29
banking industry has experienced a remarkable progress in few years. Bangladesh
government’s motive in building a “digital” nation has enforced the technological
advancement and thus encouraging mobile banking industry to prosper and exhibiting it as an
attractive one in the market.
Economic
Economic factors have a Positive effect on the industry as the current economy of
Bangladesh is being unstable.
Despite being a country with political instability, poor infrastructure, corruption, insufficient
power supplies, and slow implementation of economic reforms, the economy of Bangladesh
has grown in the past year for 2010 and 2011 but followed by a declining rate in 2012 and in
2013, according to Bangladesh Economy Profile 2013. (CIA World Factbook, 2013). The
outgoing year has been one of the most disturbing years for Bangladesh in the recent past in
terms of domestic political instability caused by hartals, blockades, and deadly violence for
months. As a result, the economy had to bear the brunt in many ways. The World Bank
International Monetary Fund, Bangladesh Bank (BB) and many experts have projected the
gross domestic product (GDP) to be lower than 6%, which is much below the target of 7.2%
for FY2014. Some even apprehend it may be lower than 5%. Poor economy implies less
employment generation and low income, which in turn has poverty implications. Even though
the disposal income reached an all time high of 31079.56 BDT THO in 2013, if the poor
economy scenario continues Mobile Financial Services (MFS) may fall into a less attractive
sector.
Social
Social factors have a positive effect on the industry.

30
Mobile financial services’ basic qualities can help the unbanked overcome barriers and reap
the benefits of financial services. MFS can be used by nearly everyone at any time of day or
night and from anywhere, eliminating the accessibility issues presented by traditional
banking. In addition, MFS provides secure services at a low cost. Through M-banking one
can avail various services i.e.; utility bill payment, fund Transfer, shopping, cash withdrawn
from selected ATM or Cash point and many more exciting facilities. The preference for MFS
is high among people as it facilitates time saving, low cost, security, and trustworthiness. It
has been elaborated that the adoption and use of MFS is embedded in social practice.
Nowadays millions of inhabitants of Bangladesh are transferring funds within a network
through mobile network coverage, thus making it an attractive industry. Peoples’ attitude
towards MFS is positive because of its usefulness and increased flexibility in operating. The
society’s health, education and mobility are heading towards positive direction and this has a
positive impact on MFS as well.
Technology
Technological factors have negative effect on the industry.
Technological factors are relevant to innovations in technology that may affect the operations
of the industry and the market constructively or unconstructively. This refers to automation,
research and progress and the quantity of technological responsiveness that a marketplace
possesses. M-banking technology, the latest generation of electronic banking transactions has
become one of the most familiar banking features, opened up new window of opportunity to
the existing banks and financial institutions. Thus in the commercial sectors like banking, m-
banking technology has brought banking facilities in hand’s grip which has made life easier,
robust and flexible. As all most every bank is up to adopting m-banking technology with the
most advanced manner, in order to beat the competition it requires innovation. The MFS
market is at an early stage of development as the newest providers are seeking to stabilize

31
their technology. For instance, bKash being one the leading players in MFS is looking
forward to improve their services through research and development towards scalability and
robustness. However compared to pace of innovation in MFS of foreign countries, MFS in
Bangladesh is still an early stage and much more to be learned about it over the coming
future.
Legal
Legal factors have positive effect on the industry.
These factors have both external and internal sides. There are certain laws that affect the
business environment in a certain country while there are certain policies that companies
maintain for themselves. Legal analysis takes into account both of these angles and then
charts out the strategies in light of these legislations. For example, consumer laws, safety
standards, labor laws etc.
Following several years of deliberations and ad hoc permissions on MFS, the Department of
Currency Management and Payment Systems of Bangladesh Bank issued “Guidelines on
Mobile Financial Services (MFS) for the Banks” on 22 September 2011 which were
subsequently amended on 20 December 2011.
These guidelines state that only a bank‐led model will be permitted. For Bangladesh B
ank this means that a customer’s account, termed "Mobile Account", will rest with the
bank and will be accessible through the customer’s mobile device.
This mobile account will be a non‐chequing account classified separately from a standard
banking account.
The guidelines permit the following services, subject to specific bank proposals to and
clearances by Bangladesh Bank:

32
1. Disbursement of inward foreign remittances
2. Cash in/out using mobile account through agents/Bank branches/ATMs/MNO’s outlets
3. Person to Business Payments (utility bill payments or merchant payments)
4. Business to Person Payments (salary disbursement, dividend and refund warrant
payments, vendor payments)
5. Government to Person Payments (elderly allowances, freedom‐fighter allowances,
subsidies)
6. Person to Government Payments (taxes, levy payments)
7.Person to Person Payments P2P (One registered mobile account to another registered mobil
e account)
8. Other Payments (microfinance, overdraft facility, insurance premiums, deposit pension
scheme deposits)
Following the initial guidelines, Bangladesh Bank also issued an update to the guidelines
with some modifications on 20 December 2011. These modifications clarified that the bank
bears responsibility for know-your-customer (KYC) practices. It restricts P2P payments
between holders of registered mobile accounts thereby restricting the use of services in which
recipient cashes out payment without opening a mobile account. With such strict guidelines,
among the seventeen permitted banks only ten were able to launch MFS where only five were
licensed to offer range of service beyond inward foreign remittances. Thus, legal rules and
regulations are impeding a positive effect on the mobile banking industry or MFS.

33
Summary
Table 3: PESTLE summary
Political Positive
Economic Moderate
Social Positive
Technology Negative
Legal Positive
With the help of the PESTLE analysis it is evident that the MFS or mobile banking industry
of Bangladesh is an attractive sector. Environmental factors need not to be considered in this
industry.

34
CompetitiveEnvironment Analysis
Porter’s 5 Forces
Threat of New Entrants - Low (Positive/Favorable)
Mobile Financial Service or Mobile Banking Industry is comparatively new concept in the
financial system and it at growing stage. However, the threat of new entrants is low due to
following reasons.
Barriers to Entry (High)
There are several factors that restrict or discourage others to enter the market. Since, the
industry is a part of financial system there are legal and regulatory barriers as well as
pressures from the existing market players.
Competitive
Rivalry
(High)
Threat of
New
Entrants
(Low)
Bargaining
Power of
Buyers
(Moderate)
Threat of
Substitute
Services
(Moderate)
Bargaining
Power of
Suppliers
(high)
Figure 6: 5 Forces Model

35
I. Huge Capital Requirement: Before providing mobile financing service an
organization must be well capitalized and must maintain required capital adequacy
and cash adequacy ratio. To start the service sponsors must provide tk. 4,000,000,000
(Four hundred Crore) as paid up capital and maintain a risk weighted Capital
Adequacy Ratio.
II. Strict Conditions, Regulation and Policies: Since mobile financial service is part of
financial system of the country there are strict licensing requirements and conditions
on the new service providers. Bangladesh Bank is the sole authority to provide
license to a new company. There are specific conditions of Bangladesh Bank such as
maintaining specific capital adequacy; cash reserve ratio, sound financial background
and solvency, well managed corporate governance, safe IT system, clear rules to
solve disputes associated with the service etc.
III. Incumbency Advantage: Existing companies in this industry enjoys incumbency
advantage because of their experience, technology, management, agent pool, wide
networks, favorable geographic locations, Know Your Customer (KYC) practice,
customer base and financing. It is difficult for a new company to negotiate with
mobile network operators (MNO), IT vendors and most importantly building an agent
pool.
IV. Unequal Access to Distribution Channel: Mobile financial service requires a
different and sophisticated distribution channel. Currently the service provided
through the agents. A successful venture in this industry requires a sophisticated and
trained agent network to reach every corner of the country.
V. Economies of Scale: Research shows thatin financial service industry economies of
scale exists among resourceful large organizations and they can operate more
efficiently than the smaller banks.

36
Expected Retaliation (High): Expected retaliation from the competitors is high because
strong and powerful banks are involved in this industry and as a result they are continuously
trying to hinder new entrant to enter the industry by influencing the government or regulatory
bodies.
Bargaining Power of Suppliers - High (Unfavorable/Negative)
In mobile financial service industry key suppliers are Mobile Network Operators (MNO) and
IT vendors.
Bargaining Power of Mobile Network Operator (Very High): Mobile financial service is
very much dependent on mobile network operators and without their partnership operating
the service is not possible. However, there are only six mobile network operators in
Bangladesh hence they have substantial bargaining power over the industry. Mobile financial
service operators must make a partnership which is known as MNO Partnership with all of
them to reach all of the target customers. Currently Grameen Phone has the largest market
share (42%), followed by Banglalink (26%), Robi (22%), Airtel (7%), Teletalk (2%) and
Citycell (1%). So the mobile communication market is mainly dominated by 3 major
companies with strong network over the country and they hold significant bargaining power
with mobile financial service providers. Very few companies of mobile financial industries
have MNO partnership with all of the mobile network operators. Moreover, MNO partnership
with banks is not the primary business of mobile network operators.
So, bargaining power of mobile network operators are very high because
 MNO market is dominated by only three large companies

37
 There is no substitute service for mobile financial service industry
 MNO partnership with banks are not main business of mobile network operators
Bargaining Power of IT vendors (Moderate): A safe, efficient and effective IT system is a
primary requirement for mobile financial service. In the industry there are both foreign and
local IT vendors providing services to the mobile financial service providers. Since, there are
large numbers of vendors available, bargaining power is comparatively lower. However,
mobile financial service is very sophisticated system hence the quality of the system and
security are very important factors, Moreover, IT system should be designed according to
MFS providers’ operation method and structure. Therefore well-known and experienced IT
vendors have higher bargaining power over the industry.
So, the bargaining power of the IT vendors are moderate because
 IT system is a primary requirement and there is no substitute
 Quality and security are important factors.
 Continuous support from the vendors is required.
Bargaining Power of the Investor (High): Fund is one of the major factors in the industry
and investors’ interest in this industry plays an important role. Bargaining power of the
investors are high because there are more investment alternatives exist and higher return
drives investment decision. Therefore, if the industry fails to deliver desired return to the
investor the industry will face lack of funds to provide the service. Moreover, regulatory body
requires sound financial condition to allow MFS provider to continue operation in
Bangladesh.
So bargaining power of investors is high because
 Alternative investments are available

38
 Well financial condition is required by the regulatory body
 There is no substitute.
Threat of Substitute Services - Moderate
Substitute services of mobile financial service are traditional payment and money transfer
service offered by banks, microfinance services, inward remittance service offered by both
banks and other unofficial payment services.
Threat of Traditional Banking Service (High): Threat from traditional banking service is
high because there are 56 schedule banks and hundreds of branches all over the country.
People also trust and prefer banks as a medium of transaction. Transaction services such as
debit/credit card, checks, bank draft, money transfer, remittance service and services offered
by banks are strong substitute of mobile financial service industry.
Threat from Microfinance (Moderate): Microfinance aims at providing financial service at
small scale to financially challenged people of rural areas. So, this industry is a potential
substitute for mobile banking financial service.
Cross Boarder inward/outward Remittance Service (Moderate): Some organizations
specialize in cross-border transfer such as (Western Money Union). Since, mobile financial
service also include remittance service, these organizations are potential substitute for
remittance service.
Unofficial and Unregulated Money Transfer Service (Moderate): There are many
unofficial and unregulated (illegal in some cases) money transfer service exist in Bangladesh
(such as individuals who delivers money from one place to another place for commission or

39
Hundi). These services are popular to ignorant mass people and potential substitute for the
industry.
Bargaining Power of Buyers – Moderate
In mobile financing sector, the primary buyers of the service are the general public as well as
business who use mobile financing as a means of making payments to both customers and
other businesses.
General Public [Low]
There are mainly 3 mobile banking operators in Bangladesh; Brac’sBkash, DBBL’s
Mobile money and M-Cash of IBBL, and they offer almost homogenous services which
have low switching costs between operators. But customers living in rural regions only
have access to Bkash, as the other mobile banking operators are yet to reach the coverage
levels of Bkash. Furthermore banks located in rural areas do not have the ability to facilitate
cross border remittance flow, or online banking services. As a result the bargaining power of
the general populous in using mobile banking is not very high, especially in remote areas who
do not have access to alternative services in their vicinity.
Businesses [Moderate]:
The Bangladesh Telecommunication Regulatory Commission (BTRC) has set the charge at
2.0 per cent for each transaction for ‘cash-in’ and ‘cash-out’ purposes and Tk. 5.0 for the
lowest amount of transactions in mobile banking. So, not only are the services rendered
standardized, the transaction costs are fixed, giving mobile financing operators no leeway to

40
make profit, this gives business great power over which operator to choose to do their
transactions, which will be of a greater quantity of cash, then that made by general customers.
But, according to the guidelines of BB, the transaction limit for the account holders of mobile
financial services has been fixed at a maximum amount of Tk. 10,000 on a daily basis and a
total of Tk. 25,000 on a monthly basis. The limit is applicable to any number of transactions.
So, any business that has monthly revenue/ costs they pay through mobile banking exceeding
Tk. 25,000 will be required to hold multiple accounts, preferably with one of the 3 afore
mentioned operators, which will increase their switching costs.
Competitive Rivalry – High
The intensity of rivalry is influenced by the following industry characteristics:
I. Number of firms (fair): In the mobile banking sector there are large number of firms
are involved so as a result it is very much possible in the future that the customer base
can be divided. At present most of the firms have pretty much same market share and
which is very low compare to BKASH. BKASH is the market leader with a large
market share. Though there is lot of firms in this industry but competition is not so
high in terms of market share.
II. Market growth (High): The market growth indicators are very high which are
around a double digit growth rate. As a result firms are able to improve revenues
simply because of the expanding market. So there is less fight among the competitors
for capturing the market share.
III. Fixed cost (High): Fixed cost in this industry is very high because the firms invest
huge amount of money in technology for giving better services to the customers. On
the other hand the firms had to trained good number of employees to giving services
to the customers at a best level. So overall the sunk cost is high.

41
IV. Switching cost (Low): Switching cost in this industry is low because customer can
easily switch from one company to another company. As a result all the firms are
struggling to capture customers.
V. Product differentiation (Low): In this kind of industry the product differentiation
scope is very low which leads to higher rivalry. In this industry Brand Identification is
very important by which BKASH actually constrain the rivalry.
VI. Strategic Stakes (High): In this industry strategic stakes are high because there is a
high possibility of losing the market as well as high possibility for great gains. So this
intensifies the rivalry.
VII. Exit Barriers (High): In this industry exit barriers is really very high. As everybody
is dealing with huge investment as well as dealing with public’s money, the firms
have to bear huge cost if they want to make the company abandoned.
VIII. Industry Shakeout (Low): Everyday new company is coming and at times it is very
much possible that market becomes overcrowded and saturated. But as the growth
rate is very high in this industry there is less chance that the market becomes
overcrowded. So this shakeout reduces competition, price wars, and company
failures.Summary of Porter’s 5 forces:
Table 4: 5 Forces Summary
Market Forces Degree of Threats Condition
Threat of New Entrants Low Favorable
Bargaining Power of Suppliers High Unfavorable
Threat of Substitute Services Moderate Favorable
Bargaining Power of Buyers Moderate Favorable
Competitive Rivalry High Unfavorable

42
In Porter’s five market forces analysis it is observed that possibility of new players in the
industry is low due to high barriers and retaliation from existing companies. Therefore, the
industry is at favorable condition for existing companies. However, threats of suppliers and
existing competitors are high because suppliers hold strong bargaining power and
experienced as well as well capitalized banks are competing in the industry. So, the industry
is at unfavorable situation due to those two market forces. On other hand, bargaining power
of buyers and threat of substitute service are moderate. Five market forces analysis indicate
both opportunities available and threats involved in the mobile financial service. Most of the
factors of the market forces are favorable for businesses. So, the industry is more likely to be
profitable and attractive for business.
0
0.5
1
1.5
2
2.5
3
Threat of New
Entrants
Bargaining
Power of
Suppliers
Threat of
Substitute
Services
Bargaining
Power of
Buyers
Competitive
Rivarly
Porter's5 Forces
Degree of Threats (1=
weak, 2 = Moderate, 3 =
High)

43
How Macro-Environment is Affecting The PORTER’S Five Forces?
There are six components which represents the Macro Environment. Those are:
1) Political and legal forces
2) Demographic forces
3) Global forces
4) Technological forces
5) Social forces
6) Macroeconomic forces
These forces have some sort of impact on the industry. These are the forces which indirectly
creates both opportunities and threats for the companies. Each of the components will be
discussed below, how these forces are affecting in the Bangladesh M-Banking or mobile
financial service Industry (affecting the five forces).
Figure 7: Macro Environment 5 Forces Model

44
Political and legal forces: In terms of legal issues, Bangladesh regulations are not that much
strict but on the other hand Bangladesh has a serious political instability. As a result these
forces are mainly affecting threat of new entrants. Although threat of new entrants is low but
for these forces to some extent it is creating barriers for the new entrants.
Demographic forces: These forces are the outcome of changes in the characteristics of a
population. These forces are not that much affecting the industry. But to some extent rivalry
amongst existing firms and threat of substitute are being affecting since they need to offer
variety of services classes to variety characteristics of the population
Global forces: These are the forces which are affecting more or less to all the Porter’s five
forces in Bangladesh Mobile Financial Service or mBanking Industry. Due to these forces
rivalry amongst existing firms force is getting higher because more and more firms are
operating. For these forces, bargaining power of suppliers is getting higher since more firms
are in the industry but very fewer suppliers. These forces are also affecting to the bargaining
power of buyers, due to these forces buyers having more options to choose among many other
financial services as a result their bargaining power have increased. Threat of substitutes also
being affected because there are other ways like international fund transfer, remittance
service, and payment, credit cards to fulfill the basic need for the people domestically and to
some extent internationally. In addition at last threat of new entrants is getting affected but
not that much because it requires huge capital to invest to start a mobile financial service
Technological forces: Due to these forces rivalry amongst existing firms force is getting high
because companies are getting more technologically advance as a result others also trying to

45
adopt it and keep up with the pace and satisfy the customers. And also due to these forces
both bargaining power of buyers and threat of substitute are getting high since they are
getting aware of the technologies and also adopting the technologies.
Social forces: Due to these forces bargaining power of buyers is getting low because people
are getting more quality and time conscious. People are becoming busy and they want a
reliable and quicker financial service. As a result numbers of the buyers are increasing, so the
bargaining power in decreasing. Also for these forces threat of substitute is getting low
because mobile financial service provide more time saving and reliable financial service to
majority of the working class people who are living in remote places where traditional
banking services are not available.
Macroeconomic forces: These forces include economic growth, interest rate, currency
exchange rate and inflation rate. These forces are very influential to the Porter’s five forces.
Bangladesh is an emerging market which means it is having rapid economic growth as a
result foreign investors want to invest in Bangladesh. Bangladesh interest rate and currency
exchange rate are quite stable compare to other countries. So it is encouraging toward foreign
investors to invest and as a result, these factors putting some effect on the Porter’s forces. In
M-Banking industry if the interest rates are stable, that is, not fluctuating, investors can raise
capital at a lower cost, making the industry a favorable one to invest and grow. The inflation
rate is another factor to be considered. The inflation rate has risen in Bangladesh than it was
last year. This implies that it is a threat for the companies to invest in this industry. Therefore,
economic growth, interest rate, currency exchange rate and inflation rate directly or indirectly
affect all the forces of porter 5 forces.

46
3 I Analysis:
Competitor analysis in marketing and strategic management is an assessment of the strength
and weakness of current and potential competitors. This analysis provides both an offensive
and defensive strategic context to identify opportunity and threats. Competitor analysis is an
essential component of corporate strategy.
According to Bangladesh Bank there are 28 banks which are approved to give mobile
banking services in Bangladesh. Out of the 28 there are 20 banks which have started to give
mobile banking services to consumers. Bkash of Brac Bank is so far the market leader. But
other banks are catching up to Bkash at a fast pace. The competitors of Bkash are divided into
three groups in the following points.
Immediate Competitors:
DBBL Mobile Money and M-Cash of IBBL are the immediate competitors of Bkash of Brac
Bank. They are the main players along with Bkash in the mobile banking market. The core
competencies of these competitors are given below.
DBBL Mobile Money (Core Competencies) –
 DBBL has partnership with every mobile network operator in Bangladesh.
 Notable partnerships with insurance providers and employers to use its platform for
distributing payments.
IBBL M-Cash (Core Competencies) –
 Very low service charges.
 Mobile banking services are based on the Mudaraba Principles of Islamic Shari'ah.

47
Impending Competitors:
The other banks who are low on market share in mobile banking sector but can become one
of the main players in the future are impending competitors for Bkash. Mercantile MCL
Wallet, Trust Mobile Money, Bank Asia, First Security Islami Bank mCash, Eastern Bank,
IFIC Bank, U cash of UCB, Jamuna Bank Sure Cash, One Bank OK mobile banking all are in
the market. They are all impending competitors for Bkash.
Dhaka bank, AB bank, South East bank, Premier bank, NCCBL bank and Standard bank have
not fully entered the mobile banking industry of Bangladesh. They provide very limited
remittance only services. But they can also expand their services and start fully functional
mobile financial services.
Invisible Competitors:
Sonali Bank, Janata Bank, Prime Bank, Citi N.A., Bangladesh Commerce Bank all have
license to start mobile banking. But they are not yet in the market. Other commercial banks of
Bangladesh may also be judged as invisible competitors as they are capable to get a license
and start mobile banking.

48
SWOT Identification
PESTLE
Political- Positive
Economical- Positive
Social- Positive
Technological- Negative
Legal- Positive
Porter’s 5 Forces
Threat of new entrants- Low
Bargaining power of buyers-
Moderate
Bargaining power of suppliers-
High
Threat of substitutes- Moderate
Rivalry among firms- High
Opportunities
 Wide mobile network coverage
and large number of active
mobile phone subscribers, over
114 million, provides a large
target market.
 Flexible rules and regulations
 Traditional banking services do
not reach to rural and remote
areas.
 Traditional banking hours are
inconvenient and it is difficult
to open as well as to maintain a
bank account.
 High growth of SME and online
businesses
 Hassles in traditional bill
payments
 Lack of safety and security in
the street
 Increasing no. of population
 Technological advancement in
adding value to the services.
 Acquaintance with the new
services is increasing in day to
day life.
 Massive market of low income
people.
Threats
 Sudden change of rules, regulations, conditions and taxation
policies.
 Corruption of the government and the authority
 Hacking, fraud, and abuse of the service
 Legal allegation concerning money laundering, financing criminal
activities.
 Yellow journalism and rumors
 Few mobile network operators.
 High competitive rivalry
Figure 8: Matching External Analysis
with Opportunities and Threats
Identification

49
Core Competencies
1. Brand Recognition
2. Agent Network
n
Core Competencies of Competitors
DBBL Mobile Money
 DBBL has partnership with
every mobile network operator
in Bangladesh.
 Notable partnerships with
insurance providers and
employers to use its platform for
distributing payments.
IBBL M-Cash
 Very low service charges.
 Mobile banking services are
based on the Mudaraba
Principles of Islamic Shari'ah.
Strengths
 High Technology and simple
banking
 Unique advertisement and
marketing strategies
 Continuous partnership
development with bill payment
and merchant payment
 Wider range of services &
innovation (Service
differentiation)
 Service availability in major
mobile network operators
 Capability to attract foreign
investors (e.g. Money in
Motion, IBM)
 Stronger customer care (24
hours call centers for bKash
subscribers
 The parent organization BRAC
is well reputed and recognized
NGO
 Opening a bKash account is
free.
Weaknesses
 Not attractive employee packages.
 Higher Service charge
 Comparatively less efficient management of
IT system
 Lack of external security
 Cash unavailability
 Unavailability of Bengali language service
menu
 Centralized management system
 Total monthly transaction amount is limited
Figure 9: Matching Internal Analysis
with Strength and Weaknesses
Identification

50
Table 5: SWOT identification at a Glance
Strengths Weaknesses Opportunities Threats
High Technology and
simple banking
Not attractive
employee packages.
Wide mobile network
coverage and large
number of active
mobile phone
subscribers, over 114
million, provides a
large target market.
Sudden change of rules,
regulations, conditions
and taxation policies.
Unique
advertisement and
marketing strategies
Higher Service
charge
Flexible rules and
regulations
Corruption of the
government and the
authority
Continuous
partnership
development with bill
payment and
merchant payment
Comparatively less
efficient management
of IT system
Traditional banking
services do not reach
to rural and remote
areas.
Hacking, fraud, and
abuse of the service
Wider range of
services & innovation
(Service
differentiation)
Lack of external
security
Traditional banking
hours are inconvenient
and it is difficult to
open as well as to
maintain a bank
account.
Legal allegation
concerning money
laundering, financing
criminal activities.
Service availability in
major mobile
network operators
Cash unavailability High growth of SME
and online businesses
Yellow journalism and
rumors
Capability to attract
foreign investors (e.g.
Money in Motion,
IBM)
Unavailability of
Bengali language
service menu
Hassles in bill
payments
Few mobile network
operators.
Strong financial
position
Centralized
management system
Lack of safety and
security in the street
High competitive
rivalry
Stronger customer
care (24 hours call
centers for bKash
subscribers)
Total monthly
transaction amount is
limited
Increasing no. of
population
The parent
organization BRAC
is well reputed and
recognized NGO
Technological
advancement in
adding value to the
services.

51
Opening a bKash
account is free.
Acquaintance with the
new services is
increasing in day to
day life.
Massive market of
low income people.
Business canvas and the current Model of bKash
Table 6: Business Canvas
A. Key Partners
Equity Partners:
BKash Limited, a subsidiary of BRAC Bank, started as a joint venture between BRAC Bank
Limited, Bangladesh and Money in Motion LLC, USA. In April 2013, International Finance

52
Corporation (IFC), a member of the World Bank Group, became an equity partner and in
April 2014, Bill & Melinda Gates Foundation became the equity investor of the company.
Mobile Network Operator (MNO) Partners:
Bkash has partnered with the major mobile network operators to provide comprehensive
coverage of their services across Bangladesh. Bkash started their partnerships with
RobiAxiata Limited in July 2011, Grameen Phone in January 2012, Banglalink Digital
Communication Limited in August 2012 and Airtel Bangladesh Limited in January 2013.
Technology Platform Partner
On the 4th of August 2011, Fundamo, part of Visa Company, was selected to power the bkash
service in Bangladesh. Through the deal, Fundamo facilitated the delivery of mobile
financing services to unbanked and under-banked mobile users in Bangladesh. Bkash enabled
a large portion of the population of Banlgadesh to their first access to basic and secure
financial services.
B. Key Activities
Providing an efficient, competitive, and simple mobile banking service
Bkash looks to provide uninterrupted, timely and cost efficient mobile banking service to
their customers. A lot of bkash’s basic services, such as registration, cash in, token encase,
checking balance, checking statement, merchant payment, online payment, have no additional
service charge. Furthermore partnerships with all the major mobile operators have made
bkash available nationwide.

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Marketing and Branding
Bkash has been more active in promoting their mobile financing services in the media than
their competitors. Bkash has looked to improve their visibility and market their financial
services, not only through traditional newspapers advertisements and billboards, but they
have looked to reach out to those in rural areas through boat branding and dramas and TVC.
Maintaining Customer Relationship
Bkash has a helpline, 16247, that is open to subscribers of any Robi, Grameen Phone,
Banglalink, Citycell, Teletalk, Airtel and BTCL Number from 8 am to 10 pm. They have
customer cares in Dhaka, Mymensingh, Sylhet, Chittagong, Khulna and Bogra. Furthermore
they can be contacted by their customers through a form available on their website.
Maintaining and developing technology platform:
Bkash is constantly ensuring that their services are online; subscribers and their followers are
notified prior to any maintenance through their twitter and facebook pages. Furthermore they
are constantly upgrading their software to provide even more efficient and timely
transactional services for their customers.
Continuous partnership establishment with business and nonprofit organizations to
provide payment service.
Bkash has strived to establish partnerships with business and nonprofit organizations alike in
order to provide their services across Bangladesh. They have achieved this by partnering
themselves with all the major mobile operators of Bangladesh, making it possible for people
living even in rural areas access to a broader range of financial services.
Raising funds from international investors and donors

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Bkash’s affiliation to BRAC, Money in Motion, International Finance Corporation and the
Bill and Melinda Gates Foundation has made it possible for them to raise substantial funds
and capital to continually expand and improve their services. It has enabled them to serve the
low income masses of the country and to achieve broader financial inclusion by providing
services that are convenient, affordable and reliable.
C. Key Resources
Strong Customer Base
Bkash Limited is at present leading the mobile financing industry with around 6
million subscribers out of a total market size of approximately 13.2 million subscribers
as of February 2014 , which is double the number of subscribers they had in 2013. DBBL
mobile banking, their closest competitors, has only 2 million subscribers in the industry.
Brand Value and Recognition
Unlike other banks, Brac has taken the positive initiative to create brand value and
recognition for its mobile financing service, Bkash. Bkash has used boat branding, car
stickers, drama and TVC along with traditional newspaper advertisement to promote brand
value and recognition. Furthermore bkash’s equity partners, BRAC Bank, Money In Motion,
International Finance Corporation, Bill and Melinda Gates Foundations, are all well
renowned across the globe, and Bkash’s partnership with them has helped boost their brand
value even further.
Financial Resources:
BKash has built its foundation capitalizing the unique resource base of its four stakeholders--
BRAC Bank, Money in Motion, International Finance Corporation and the Bill & Melinda
Gates Foundation. BRAC Bank, a SME focused private commercial bank in Bangladesh,
works closely with its parent organization, BRAC, which has grass-root presence in every
corner of Bangladesh. Money in Motion, besides bringing entrepreneurial leadership brings
together investors and initiators of successful mobile network, mobile money and mobile

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commerce operators. IFC and Gates Foundation, along with the capital, bring global
governance practices and knowledge on Financial Inclusion.
Country-wide service coverage:
Through their partnerships with all major mobile operators of Bangladesh; Grameen phone,
RobiAxiata limited, Banglalink Digital Communication Limited, AirtelBanlgadesh Limited,
bKash’s technology allows 98% of the country's mobile users to access its service via very
basic handsets. Furthermore they have 85,000 agents and over 300 ATMS to service their
registered users.
Strong network of agents
From its inception on July 21, 2011 bkash has managed to create a strong network of agents,
which stood at more than 85,000 agents as of February 2014. This means bkash now has
about one agent in every village of rural Bangladesh, “this assures access to agents in the
remotest part of the country”.
Accessibility
Robi ,GP, Airtel and Banglalink subscribers can access the system Registered users
access directly through USSD by dialing *247#. Furthermore bkash has 85,000 agents and
over 300 ATMs for their registered users to top up and withdraw money from their bkash
accounts all within reasonable distance.
Wider range of services
Bkash provides a wide array of both transactional services- Cash In, Cash Out, Sending
Money, Creating Tokens, Redeeming Tokens, Merchant Payments, and non-transactional
services- Registration, Check Balance, Request Statement, Changing PIN, all available on the
palm of their hands. Furthermore, several educational institutes such as North South

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University and Milestone colleges have started using bkash as their primary means of
accepting admission fees. bkash is also used by SMEs to pay the salaries of their employees.
D. Value propositions
Convenient and accessible for clients
bKash users enjoy increased convenience of accessing their finances from their own mobile
phones anytime, anywhere. bKash gives its customers the flexibility to perform transactions
24 hours a day, 7 days a week, regardless of time and place. "No queues no waiting"; the
most convenient way of transferring money. Be it on a bus, train, launch, or anywhere else; as
long as the customer has a bKash Wallet on his/her mobile phone, s/he can access the bKash
wallet and send or receive money in seconds. The bKash interface also uses a very easy and
simple instruction based USSD channel. By dialing *247#, anyone can transfer money just by
tapping a few buttons on his or her mobile phone. bKash is the most convenient way of
transferring money. From higher to lower income level, Bkash has created substantial value
among customers with its convenient/ usable services. The accessibility has reached the peak
even in attracting the unbanked, poor, illiterate people to have access to mobile banking
service by bKash.
Availability of cash
bKash ensures the availability of fund in agent stores and thus keeps an amount in advance in
case of cash shortage. Such preceding approach helps bKash in providing more services to
more customers and thus creating value for them.
Nationwide service through agents
bKash is the easiest and safest way to send or receive money instantly on your mobile,
nationwide. No matter where it is in Bangladesh, bKash is always ready to serve.bKash
focuses massively in providing customers with quality, hassle free services. In order to

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achieve the idea, bKash follows the strategy of catering its customers from almost every part
of Bangladesh through a large crowd of agents so that the service can be availed at a close
proximity. The agents are also trained about the paper works and other activations needed to
sign up for bKash account so that the customers can show interest in signing up for bKash
account.
Fast transaction with the help of MNOs
The Multi MNOs play a significant role in connecting user-owned handsets and servers of
MFS providers and in transacting money with no late. Due to the partnership with four giant
MNOs of Bangladesh ( Grameen Phone, Robi, Banglalink, and Airtel), bKash has managed
to secure 98% of mobile users to have access to bKash. The partnership with the MNOs
creates value among customers by increasing reliability with the fastest transaction from any
operator they prefer sitting at the remotest area of Bangladesh. bKash is dedicated to
widening the net of financial inclusion among the people of Bangladesh by facilitating money
transfer through mobile phones. bKash provides Mobile Financial Services allowing
customers to send, receive, and pay money from their mobile phones. Send and receive
money, or make payments the fastest way there is!
Cost effective services
bKash has introduced itself within the mobile banking industry in the most cost effective
manner. Increasingly, free offers and low charges by bKash have been able to satisfy the
needs of price sensitive customers of Bangladesh. For instance, bKash has been able to
capture the majority market with its jaw dropping initiative of opening bKash accounts for
free. bKash provides the highest benefits to its customers at an affordable cost, enabling
everyone to access the formal financial system of the economy.In addition to eliminating
initial monetary costs involved in entering the banking system, bKash greatly minimizes
opportunity costs such as time and effort required to access such services. The service
charges are minimal and there are no hidden costs involved.

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Risk reduction by providing security
Customers value reducing the risks they incur while purchasing any service. bKash has taken
all possible safeguard in ensuring the security of its client’s money. bKash offers individuals
with private PIN code to prevent any risk of misplacement or theft even if the mobile phone
is lost.State-of-the-art technology provided by VISA ensures that the client’s money is
always safe and secure in the system of bKash.bKash places a high priority on protecting
information to assure that the transactions and data are secure with bKash. Its security and
compliance practices are regularly audited to ensure that they meet the highest standards.
Brand status
bKash is a subsidiary of BRAC which is a reputed conglomerate in Bangladesh. The name
BRAC itself has helped to create a good image among people and thus bKash is cherishing
the brand image of its parent company in every stage of gaining customer’s trust.
How bKash is creating value for its customers by linking value propositions?
The overall bKash value proposition is simple: a safe, convenient place to store money; a
safe, easy way to make payments and money transfers. With the ultimate objective of
ensuring access to a wide range of financial services for the people of Bangladesh, bKash
specially focuses to serve the low income masses to achieve broader financial inclusion by
providing services that are convenient, affordable and reliable. Among 68% of Bangladeshis
who use mobile phones, bKash was formulated at the very first place to utilize the mobile
devices and the omnipresent telecom networks to expand financial services more securely to
the under-served remote population of Bangladesh. A bKash mobile wallet is customer's
financial account, into which money can be deposited and out of which money can be
withdrawn or used for various services. Customers are able to receive electronic money into
their bKash accounts through salary, loan, domestic remittance, and other disbursements and
eventually cash-out the electronic money at any of bKash's vast of agent network of 80
thousand retail points. One of the reasons for bKash's success is its focus on serving the poor.

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It was important to come up with a simple interface that can be accessed by the cheapest (i.e.
$15) handset. Smart-phones would make it easy to implement mobile money, but the service
would then be limited to only affluent customers and would defeat the purpose of reaching
the unbanked and poor. bKash opted for USSD that allowed anybody to access bKash
platform by dialing an access code, regardless of the sophistication of the handset. With all
the value propositions along with the brand value of itself, bKash is creating value for its
customers and finally reaping customer satisfaction.
E. Customer Relationships
Bringing mobile top-up service:
In 2014, Mobile financial service provider bKash has launched 'Buy Airtime' service
allowing the bKash wallet users to top up mobile balance of Banglalink, Robi and Airtel
numbers through bKash. According to a statement, any individual bKash wallet user can
recharge his/her own or someone else's Bangalink and Airtel connection, both prepaid and
postpaid, and Robi's prepaid connection through this service and no additional charge is
applicable for buying airtime through bKash; opening of bKash wallet is also free of cost.
This form of Customer Relationship was driven by aggressive acquisition strategies. More
operators of Banglalink, Robi and Airtel would want to open new bkash accounts as both
opening of bkash wallet and buying airtime is free of additional charges. Due to this bkash
would be able to expand their customer base.
Signing agreements with universities
To introduce a new and convenient mobile payment option for DIU students from their
bKash account, a memorandum of understanding (MoU) was signed between Daffodil
International University (DIU) and bKash in 2014. According to this agreement DIU’s
existing and new students will get the opportunity to pay their payment of admission fee,
registration fee, semester fee and all other fees and to utilize other mobile financial services

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offered by bKash. Bkash also signed an agreement with North South University in 2012
which facilitates the payment of tuition fees through Bkash.
Launching campaigns
In 2014, before the celebration of bangle New Year, bkash launched a campaign that offered
20 percent cash back to its customers for use of the service at Deshi Dosh outlets to mark the
Bangla New Year or Pahela Boishakh. A statement was also placed by Rezaul Hossain, chief
commercial officer of bKash regarding this campaign: “We are very happy to be partnered
with Desi Dosh to launch the campaign as it is going to be a rewarding experience for our
valued customers. We have planned to bring more exciting offers for our customers in
future.”
Through personal assistance
Bkash maintains customer relation that is based on human interaction. Any Bkash customer
can communicate with a real customer representative of Bkash to get help or to satisfy any
query. In order to get direct help customers can call at 16247 from any mobile operator or
may email at support@bkash.com. Bkash also maintains customer service centers where
customers can visit to get help. The centers are located at 6 different zillas in Bangladesh:
Dhaka, Mymensing, Sylhet, Chittagong, Khulna and Bagura.
Contribution to BishwoShahittoKendro (World Literature Center)
In February 12, 2014 Bkash lent 34,000 books to the BishwoShahittoKendro (World
Literature Center) for the school and college students of Bangladesh. Through this
contribution 45,000 students of 460 schools in Bangladesh will get books each year.
Signing agreement with Yellow

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In January 19, 2014 Bkash signed an agreement with “Yellow” a clothing brand of Beximco
Group. According to this agreement the customers of Yellow can make the payments through
bkash for both purchases from yellow outlet and purchase from Yellow website.
Signing agreements with various hospitals
Bkash signed agreements with Farazi Diagnostic and Hospital and Ibrahim Cardiac Hospital
in 2014 and 2013 respectively. According to these agreements the patients of these hospitals
can make their medical payments through bkash.
Celebrating Birth Anniversary of Rabindranath Tagore
ShurerDhara, a music school founded by RezwanaChoudhuryBannya organized a three-day
festival on the occasion of the 150th birth anniversary of Rabindranath Tagore. The festival
was held at the Bangabandhu International Conference Centre, Dhaka from December 29 to
31, 2011. As a commitment to preservation and spread of the arts and culture of Bangladesh,
this was a unique and exclusive opportunity for bKash to showcase and support the best of
Bangla arts and literature. Alongside other organizations, bKash and BRAC Bank jointly
participated to celebrate this great occasion with special sponsorship for Musical Evenings on
29th and 30th December of 2011.
Qubee Laptop Fair 2013
Qubee Laptop Fair, the 13th laptop fair in the country, was organized at the Military Museum
Ground, BijoySharoni for seven (7) days in 2013. bKash was the official Ticketing Partner of
this event. Those who opened a bKash Account at the venue were given FREE Entry to the
fair.

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E-Commerce Fair 2013
Computer Jagat, a pioneer and the most popular ICT magazine of the country has recently
organized a 3-day long first ever “e-BanijyoMela 2013” (e-Commerce Fair 2013) in
Bangladesh. The event took place on 7-9 February 2013 in Sufia Kamal Public Library,
Shahbagh, Dhaka. bKash participated in this event as Gold Sponsor, where we distributed
leaflets explaining bKash and its range of services to visitors. Visitors were able to open
bKash accounts with their Robi, Grameenphone, Banglalink, and Airtel connections.
Digital World 2012
Digital World 2012 – Knowledge to Prosperity conference in Bangabandhu International
Conference Centre, Dhaka. The three-day Digital World comprises thematically inter-related
conferences, plenary and technical sessions with workshops, seminars, discussion and
exhibition. bKash participated in the exhibition with a stall where visitors were able to
register for free and open bKash accounts with their Robi, Grameenphone and Banglalink
connections. Also the visitors have been clued-up with an in-depth knowledge on mobile
financial services which they may access from their mobile phones using bKash.
F. Channels
bKash possesses channel partners in order to cater its services to customers. The partner
channels are indirect which comprises agents, mobile network partners, customer centers,
schools, universities, shopping places, travel agencies, restaurants, NGOs and other different
media. bKash has also signed agreements with different organizations to facilitate salary
disbursement through bKash. In respect to build awareness about the service, bKash has
implemented its innovative marketing strategy in an extensive manner which is proven as a
fruitful step in the mobile banking industry indeed. However, 80,000 agents and 6 customer

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centers of bKash along with 3 other distributors act as supporting partners in delivering the
service to the customers and providing post-purchase customer service respectively.
Moreover, mobile network operators are responsible for serving the superior connectivity
between mobile users and bKash and also allowing bKash to execute its new service of
buying mobile Airtime through bKash wallet as a method of serving its customers. Here are
some of the channel partners of bKash.

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G. Customer Segments
bKash segments its customers according to
I) Similarity in needs and
II) Response to similar marketing program.
bKash follows a mass marketing segmentation where the company follows an
undifferentiated marketing program. It also segments its markets demographically where it
focuses on occupation, income. Students, business entrepreneurs, high and low level job
holders, all types of service holders are the demographically segmented customers for bKash.
People from social economic class A, B, C, D and E are also the segmented customers for
bKash.
Social class and VALS (Values and Lifestyles) are the psychographic segmentation for the
company. High, middle and low social class people and people with different attitudes and
lifestyles who are looking for value against their payments for particular services are the
customers of bKash.
bKash also follows behavioral segmentation. Depending on the usage rate it has segmented
its market into 3 groups- High Medium and Low. The company also divided its market
according to user status as Non user, Potential user, Ex-user, First time user and Regular user.
bKash has segmented its customers according to the benefit segmentation. bKash provides
money transfer benefits to its customers. Anyone who are seeking for money transfer benefits
are the prime customers of bKash.

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H. Cost Structure
Cost structure of an organization is very important in determining the business model. bKash
has quite a bit expensive cost structure as it is the largest mobile banking service in
Bangladesh.
Fees given to network provider
Every year bKash gives good amount of fees to the 4 mobile network operators for initiating
the transaction by using mobile network. All the 4 mobile companies give the same amount
of value added services technological support to bKash in exchange of some handsome
amount of fees.
Commission given to the Agents
For every transaction the agents get some commission. For example for sending every 1000
tk. the agents get 20 taka as commission. It has extensive distribution network with more than
70,000 Agents covering each district and thana.
Technology
For security purpose bkash has used good technologies. Every transaction is protected by
customer’s own PIN, which are always safe and secure in system. On the other hand, bKash
security and compliance practices are regularly audited to ensure that they meet the highest
quality of standards. For these bKash has to spend good number of money. Meanwhile,
bKash uses the ATM services of BRAC Bank Limited by which bKash customer can anytime
withdraw money from their bKash account. For using this ATM services bKash gives some
fees to BRAC Bank. bKash also maintain some strategic partnership with some service
companies like Nandos, Pizza Hut and G4S where they have to provide agreed money to their

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partners. bKash also uses their technologies by which people give admission fees of different
schools, do online shopping etc. and for that they have to provide some fees to that particular
schools and web based companies.
Fixed Costs
The company has to bear very little amount of fixed costs because bKash doesn’t have any
branch offices. Their services are provided by their agents for whom the agents get some
commission. Besides bKash has some sales representative who actually help people to open
A/C with bKash by going doorstep. For their salaries bKash need to bear some cost. Other
than that the company bears some good amount salaries expense for their 500 permanent
corporate employees.
Marketing and Advertising
To compete in this competitive industry bKash has flourished them by spending huge amount
of money in advertising and marketing. With this strategy bKash has now captured highest
market share. The main target market of bkash is rural people and lower class people.
Through billboards, wall painting, TV commercial and agent point brandingbKash has
reached almost 3 million customers but for that they had to bear lot of cost.
I. Revenue Streams
bKash has multiple revenue streams. They offer services which add to their revenue streams.
They are also working very hard in these streams to survive in the oligopoly market of mobile
banking in Bangladesh. The revenue streams are described below-

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Send money
The revenue stream of bKash is built around this primary activity. People need to pay a
certain amount to send money to another bKash account. bKash generates most of its revenue
from this operation.
Cash out from agent
The operation above and this operation are very closely related. People need to pay a fee to
the agent if they want to cash out from their account. This operation also earns a lot for
bKash.
Cash out from ATM
People can cash out from the ATM but they need to pay a fee. The amount one can cash out
from the ATM is from 2000 up to 20000 BDT.
Though there are few operations in the revenue stream of bKash and service charges are also
very low; the customer base of bKash is huge. So, the number of transactions each day is also
huge. As a result bKash earns a huge amount of revenue.

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Current Business Model of bKash
Brand value is the key resource of bKash and major attributes of brand values are
differentiation, value addition and cost minimization. These three attributes are enriched with
various strategies formulated by functional level, business level and corporate level
management. Different strategies have contributed to security, technology, channels, major
MNOs (Mobile Network Operators) country wide range, economies of scale, branding, and
partnership and all those strategies have led to lower cost, more differentiation and higher
value. As a result bKash is the most valuable brand in mobile banking or mobile financial
service industry of Bangladesh.

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Cost Minimization Differentiation
Value Addition
Security
Two factor
Authentication
Data Integrity
Confidentiality of
Information
No Repudiation
Visa
Technology
ATM Cash-out
Agent
Network
Strong
Customer Base
Channel
Distribution
Outsourcing
Economies
of Scale
Low Fixed Cost
Branchless
Banking
Countrywide
Service
Training &
Motivation
Commission
Simple Process
No A/C
Opening cost
Productive
EmployeesPerformance
Management
CompetitiveCompensation
Career Growth
Bran
d
Value
Major MNOs
Partnership
Educational
Institutes &
Hospitals
Bill Payment
Remittance
Businesses
Creative
Advertisement
Revenue
Collection
Effective
Branding &
Marketing
Product Development
Salary
Disbursement
Good Customer
Service
Customer
Responsiveness
Figure 11: Current Business Model of bKash

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Core competency of bKash
Figure 10: Core Competency
bKash’s core competencies are made up of their strong agent network and robust brand
recognition. They cover a vast area around the country through powerful agent network.
Anywhere around the country the fair distribution and supply is available by bKash distribution
channel. The company has almost 80,000 agents in 64 districts that are working relentlessly to
keep the operations of bKash up and running. With the help of the leading mobile phone
operators like Grameen Phone, Robi, Banglalink and Airtel they made them more convenient to
reach by the target customers.
Moreover bKash has created a strong brand recognition through their unique marketing and
communication methods. The marketing department of bKash has done a brilliant job by making
the brand bKashsynonymous to money transfer activities. Their unique promotional activities
such as boat branding, car stickers, TVCs and many more have captured an exclusive spot in the
mind of the customers. Moreover bKash is the subsidiary of BRAC, which itself has a strong
reputation around the country that helps to uplift the brand bKash also.
Agent
Network
Brand
Recognition
Core
Competency

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Corporate level strategy
Corporate level strategies drive a company’s business model over time and determine which
types of business and functional level strategies managers will choose to maximize long run
profitability. Corporate level strategies make the headline decision for the company and give a
direction to the company. We now look at the different corporate level strategies bKash is
pursuing.
Mission
By providing financial services that are convenient, affordable and reliable, bKash aims to widen
the net of financial inclusion. bKash wants to provide a solution for Mobile Financial Services,
built on a highly scalable Mobile Money platform, allowing the people of Bangladesh to safely
send and receive money via mobile devices.
Ultimate objective
The ultimate objective of bKash is to ensure access to a broader range of financial services for
the people of Bangladesh. It has a special focus to serve the low income masses of the country to
achieve broader financial inclusion by providing services that are convenient, affordable and
reliable.
As bKash is a subsidiary of Brac Bank Bangladesh and Money in Motion LLC USA we start
analyzing the corporate level strategies by keeping them in mind. bKash follows the following
corporate level strategies in its business-
1) Diversification- Related linked Strategy
2) Strategic Alliances
3) Strategic Outsourcing

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Diversification- Related linked Strategy
bKash was created because of a corporate level strategy of Brac Bank and Money in motion.
They are both financial institutions who decided to come together to create another financial
institution called bKash. bKash direct links with Brac Banks business as well as money in
motions business. But the links are not that strong. They basically created bKash by transferring
knowledge and competencies. Brac Bank and Money in motion both are huge corporations. They
already have developed competencies and capabilities. So bKash is enjoying the economics of
scope because of its parent companies. Market power of Brac Bank is also there for bKash to
enjoy. They have a big support as their parent company is so strong.
Strategic Alliances
bKash is basically a product of a strategic alliance. Brac Bank Bangladesh and Money in Motion
USA together built this institution by forming a strategic alliance. At the time bKash started its
operations Brac bank had 51% of the shares of bKash whereas Money in motion had 49% of the
shares. They are also focusing on including more strategic partners for bKash. In April 2013,
International Finance Corporation (IFC), a member of the World Bank Group, became an equity
partner and in April 2014, Bill & Melinda Gates Foundation became the equity investor of the
company. Together in a long term based operation; these institutions are making the project
bKash successful. By forming these strategic alliances bKash has actually ensured that each
partner will keep their side of the bargain and also commitment is credible.
Strategic Outsourcing
In the process (cash in, cash out etc.) of the business of bKash there must be a mobile phone
operator to make the process happen. But bKash does not own a mobile phone operator
company. This important activity in the value chain of bKash is outsourced. The job has been
given to the existing mobile phone operators in Bangladesh. So the individual specialist
companies which are the mobile phone operators get to carry out this activity for bKash. So,
bKash strategically outsource the activity to them. The process is less costly for bKash to

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outsource. And also people of Bangladesh are already using different mobile phone operators. So
offering the services through them makes it more convenient for consumers. It also helps bKash
to reach a very big market at once.
Corporate level strategies ofbKashand its mission-The relationship
So the corporate level strategies of bKash are basically Diversification- Related linked Strategy,
Strategic Alliances and Strategic Outsourcing. And the mission is- “By providing financial
services that are convenient, affordable and reliable, bKash aims to widen the net of financial
inclusion. bKash wants to provide a solution for Mobile Financial Services, built on a highly
scalable Mobile Money platform, allowing the people of Bangladesh to safely send and receive
money via mobile devices.”
The related linked strategy allows bKash to achieve and enjoy economics of scope. The same
strategy allows bKash to have the market power from the very beginning. Strategic alliances are
keeping bKash stable and long term. And outsourcing is allowing bKash to cut the cost. So the
aim of a convenient, affordable and reliable service is fulfilled. The economics of scope is
allowing bKash to give consumers a wide net of financial services through mobile banking. The
strategic allowance of bKash is also allowing bKash to make the service long term and safe.
Thus through these strategies bKash is stepping closer and closer to its mission.
The ultimate goal of bKash is to ensure access to a broader range of financial services for the
people of Bangladesh. It has a special focus to serve the low income masses of the country to
reliable. By following the above strategies bKash is being able to keep its services convenient,
affordable and reliable. And also there are scopes to widen the range of services that bKash can
offer to the market.
Corporate Risk Management
Corporate risk management refers to the initiatives taken by the organizations that may assist the
business and functional level management of the organization in reducing the risks. Corporate

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level of bKash also took some steps that may reduce the overall risk of the company at the same
time provide efficiency in overall activities of business and functional level managements.
Increased Scope of operations
bKash Activates International Remittance Facilities
The primary purpose of bKash is to assist the lower income and middle income people in
Bangladesh in money transfer activities. They have widen their scope of operations by
introducing international remittance facilities to their target market. This may help the company
to tap into a new market which comprises of international money transfer activities. bKash
account holders can directly receive international remittance on their mobile phones. This service
will immensely facilitate the remittance receivers all over the country as well as give peace in
mind to millions of remitters abroad.
South East bank Limited (SEBL) and bKash recently signed an agreement on remittance
disbursement service to facilitate beneficieries of foreign remittance to receive funds directly on
their mobile phones. This initiative helps bKash to diversify their risk of operating only in the
local market where many competitors are looming high to capture market share. They have tap
into new market as well and reduced their corporate risk.
bKash Facilitates in Brac Microfinance
Microfinance is the most robust term in third world countries these days. Hundreds of
organizations are working to alleviate poverty in poor countries through microfinance. In
Bangladesh microfinance term has been taken to a new dimension by Dr. Muhammad Yunus. As
a company related to financial activities, bKash took a new toll by agreeing to facilitate Brac

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Microfinance by their operations. With their new agreement between bKash and
Bracmicrofinance, they will be facilitating the collection process of deposits for Saving Schemes
from their customers through bKash. This initiative is very significant for bKash as they are the
first company in the industry to facilitate this service. This service will reduce their overall risk
as well.
Increased Efficiency
Performance Management System among Employees and Agents
bKash is keen to increase their efficiency at any cost. A vast number of operations of bKashis
facilitated by their agents who are the direct links to their customers. At the same time
employees of bKash are considered as asset as they are the main driving force for the company.
With an aim to increase efficiency, bKash has introduced separate Performance management
System (PMS) for its employees and agents. But the overall goals are same in both the systems.
The main goals of this Performance management systems are-
 Enhance the overall performance of agents and employees.
 Develop a positive way of approaching to the customers.
 Help them to perform according to the organizational culture.
 Promote best practice in conducting tasks.
These steps will help the agents and employees of bKash to increase their efficiency. Increased
efficiency is a must to compete in a very competitive industry like mobile money transfer
industry in Bangladesh. Less efficiency in operation can result in loss of market share to the
competitors. Through the above initiatives bKash has made sure that their efficiency level rest at
the zenith point than their competitors which ultimately will reduce their corporate risk.

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Business level Strategies
An organization's core competencies should be focused on satisfying customer needs or
preferences in order to achieve above average returns. This is done through Business-level
strategies. Business level strategies detail actions taken to provide value to customers and gain a
competitive advantage by exploiting core competencies in specific, individual product or service
markets.
Key Issues of Business Level Strategies
There are some key issues of business level strategies which are concerned about the customers
of an organization and satisfying customers is the foundation of successful business strategies.
Therefore, before discussing about the business level strategies of Bkash, key issues in the
business level strategies are being discussed below:
Who will be served?
The ultimate objective of bKash is to ensure access to a broader range of financial services for
the people of Bangladesh. More than 70% of the population of Bangladesh lives in rural areas
where access to formal financial services is difficult. Yet these are the people who are in most
need of such services. Therefore, the main customer group that is being served by Bkash is the
low income group of people of Bangladesh. At present the educated, upper class people also use
Bkash for several transaction purposes. Moreover, Bkash is also being used to collect foreign
remittances. Therefore, Bkash also serve the upper class segment of people.

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Figure 12: Customer Segments
What needs to be satisfied?
Bkash wants to fulfill the financial needs of people in a way that is more convenient, affordable
and reliable. Ensuring access to a broader range of financial services for Bangladeshi people is
the ultimate objective of Bash.
How those needs to be satisfied?
The aim of Bkash is to fulfill the basic banking needs utilizing mobile phones to the people who
are unable to use conventional Bank services for different reasons and constraints. Less than
15% of Bangladeshis are connected to the formal banking system whereas over 68% have mobile
phones. Bkash provides financial services through mobile phones that can make the service more
accessible and cost effective for the vast population of Bangladesh.
Bkash Customer Segment
Low income group
living both in rural
and urban areas
Higher income group
living both in home
country and abroad

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Five Generic Business Level Strategies
Figure 13: Five Generic Business Level Strategies
bKash is serving a broad market of mobile financial services using its capabilities to create value
for customers on an industry-wide basis. Among five generic business level strategies, bKash
falls under Integrated Cost Leadership/Differentiation whereit is leading as a service
differentiator and cost leader in the market. This strategy’s competitive advantage is in between
Cost Leadership Differentiation
Focused Cost Leadership Focused Differntiation
Intregated Cost
Leadership/Diff
erentiation
Lowest Cost Distinctiveness
BroadMarketNarrow
Market
Business for Customer Value
TargetMarket

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cost and uniqueness and competitive scope is in-between broad target and narrower target which
is a safe position in business level strategy as shown on the above chart.
The distinctive competencies include superior brand recognition and ubiquitous agent network.
bKash considering its core competencies along with its wide range of services, low cost structure
and open platform for innovations makes it the service differentiator as well as the cost leader in
the industry. To bKash low cost structure is the driving factor as it has a special focus to serve
the low-income people of the country with its widespread agent network and promote sustainable
micro-savings to achieve broader financial inclusion by providing financial services that are
convenient, affordable and reliable and thus creating value among its customers. Unlike bKash,
none of its immediate or impending competitors have been able to capture the broad market of
Mobile Financial Services even following the business strategies due to the lack of brand
recognition. However, bKash possesses the superior status of BRAC, a giant of the country.
Competitive Positioning and the Value Creation Frontier
Figure 14: Value Creation Frontier
 bKash being the integrated cost leader and differentiator occupies the middle
segment of the value creation frontier. In the very segment bKash has the highest
customer responsiveness. With the state of the art technology through a visa company,
widespread agent network, low cost structure, and mobile network coverage from 4

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MNOs bKash has succeeded to attain the title of leader exerting tough competition to the
rivals.Thus the integrated strategy enables bKash to reach a high profitability level and
become an increasing threat to both differentiators and cost leaders over time.
Product Life Cycle
Figure 15: Product Life Cycle
The mobile banking industry is currently in the growth stage with huge potential for companies
to increase their sales and capture market shares.bKash being the early mover of mobile financial
industry, it has been able to hold its stand at the age of almost 3 years. In product life cycle, we
can see bKash is in the growth stage with an increasing rate of growing. Recently, bKash is
acting as a leader in the industry and it has succeeded to achieve the title with its extensive
growth in number of subscribers. In 2013, with 76,000 agents and 180 distributors bKash
accounts stood at close to 8.0 million across the country. However in 2014 bKash accounts is
expecting to touch 15.0 million at the end of the year by exploiting the huge business expansion
opportunity in Bangladesh over 110 million cell phone users, and 60 percent unbanked people
out of 160 million population. The performance of bKash is also depicted in a survey of
percentage of market share of mobile financing services in 2013 where bKash were able to
capture 71% of the market share in a two year gap.

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ANSOFF Matrix
Figure 16: ANSOFF Matrix
bKash is Bangladesh’s first complete mobile financial service provider in the industry of mobile
banking and bKash introduces Mobile Banking Services in Bangladesh. Bkash paved the way for
the people living in rural areas to get introduced with money transfer services via mobile phones.
Therefore it can be stated that bkash followed “Diversification Strategy” as it introduced new
products which is mobile financial services, in the new market which is the Mobile Banking
Industry.
Recently Bkash has signed various agreements with different universities, hospitals and clothing
brands so that the customers of this organizations can make their payments through Bkash.
Moreover, BKash has launched 'Buy Airtime' service allowing the bKash wallet users to top up
mobile balance of Banglalink, Robi and Airtel numbers through bKash without the free of any
additional charges. Therefore Bkash is now pursuing “Product Development Strategies” as the
organization is trying to introduce new kinds of services in the existing market.

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The BCG Matrix
Figure 17: Growth Share Matrix
The BCG matrix is based on the Product Life Cycle Theory. The product of Bkash is in the
growth stage with huge potential for company to increase its sales and capture market shares.
Less than 15% of Bangladeshis are connected to the formal banking system whereas more than
60% of the total population has access to cell phones. So the financial services through mobile
phone are accessible to majority of the population. Moreover, people are more and more willing
to conduct their financial transaction through mobile banking. Bkash is not only limited to
paving the way of financial transaction for people of low income but also it is constructing new
ways to introduce more financial services. People can now pay their medical fees, tuition fees,
shopping bills with the help their Bkash accounts. Moreover, Bkash only had Grameenphone and
RobiAxiata as their partners, now Banglalink and Airtel also stepped in. In addition to that the
customers of these mobile operators can recharge their balance with the help of Bkash. However,
Bkash is now reaching more and more customers by expanding in the form of increased number
of ATM cash outs and customer centers in various districts of Bangladesh. Therefore, Bkash can
be identified as “Stars” with high relative market share and high market growth rate.
Business level strategies helping to achieve Corporate level strategies
bKash follows an integrated cost leadership/differentiation strategy targeting a market in
between broad and narrow of mobile financial services. bKash is clear about its position in the
market and thus it seeks hard to establish its business level strategies in the most effective

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manner in order to gain the ultimate corporate level strategies. The mission of bKash implies that
“by providing financial services that are convenient, affordable and reliable, bKash aims to
widen the net of financial inclusion. bKash wants to provide a solution for Mobile Financial
Services, built on a highly scalable Mobile Money platform, allowing the people of Bangladesh
to safely send and receive money via mobile devices.” To comply with the mission bKash has
designed its business level strategies being the cost leader as well as the differentiator in the
industry. Thus in order to solve the financial service crisis it has intervened into the market with
wide range of services to widen financial inclusion, ubiquitous network of agents for
convenience and accessibility, security of money to ensure safety of money transaction and
utilization of technology leading to innovation, low cost structure to build highly scalable mobile
money platform (free registration, low cash out charge, and free checking balance) and
moreover, the branding and status of the parent company to grow customer responsiveness.
Taken as a whole it can be said that bKash’sbusiness level strategies are working as an assistance
for the company to achieve its corporate level strategies.
Functional Level Strategies
It is paramount that an organization must not only satisfy but delight their customers by
providing high quality products at affordable prices to be able to have a sustainable business.
Bkash has been doing just that which has made them the market leaders in mobile banking sector
over the last three years.
A bKash mobile wallet is the customer's financial account, into which money can be deposited
and out of which money can be withdrawn or used for various services. Customers are able to
receive electronic money into their bKash accounts through salary, loan, domestic remittance,
and other disbursements and eventually cash-out the electronic money at any of bKash's vast of
agent network of 90 thousand retail points. According to CGAP, the World Bank group that
works on access to finance, by March 2014, 22% of Bangladesh's adults uses mobile money and
a significant part of such mobile money adopters use bKash.

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One of the reasons for bKash's success is its focus on serving the poor. It was important to come
up with a simple interface that can be accessed by the cheapest (i.e. $15) handset. Smartphones
would make it easy to implement mobile money, but the service would then be limited to only
affluent customers and would defeat the purpose of reaching the unbanked and poor. bKash
opted for USSD that allowed anybody to access bKash platform by dialing an access code,
regardless of the sophistication of the handset
Considering the size of the potential customer base, bKash adopted a highly scalable electronic
payment platform outsourced from VISA that offers the global standard of financial data
processing and security.
Divisions and Departments of Bkash
Management Division
Management division of bKash is comprised of 5 units-
Corporate Strategy and Decision making Wing
This unit of bKash is responsible for any corporate strategy and decision making. All the final
end decision is implemented after being approved by this management unit.
Corporate Affairs
This unit deals with all the corporate communications needed for the company. They also keeps
the connection with higher levels of armed forces and government ministries to keep their
operation running.
Brand
This unit deals with the overall brand management and promotion activities of the company. The
unit covers both outdoor (billboard, road overhead etc) media and indoor (print & electronic)
media.

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Service development and Management
Service development and management unit concentrates on developing their service facilities. At
the same time they are responsible for managing the dealers and agent management.
Corporate Sales
Corporate sales is responsible for overall sales of bKash. They also determine and forecast the
over sales for bKash. They also assist the corporate strategy and decision making wings in
decision making through their forecasting.
Marketing Division
The marketing division of bkash has 3 primary divisions:
Product development team
In the product development team , their main objective is to find out new scopes and
VAS to improve the product. Beside this they are carrying out surveys to find out the
market position of Bkash. Surveys are also carried out following every event to find how
successful they were compared to the costs incurred. All the surveys are being carried both on
and off the field and the results are getting compiled and analyzed regularly. The product
development team consists of one manager, one assistant manager and a few officers. The
manager directly reports all their findings to the marketing director.
Media Team
One of the most important teams in the marketing division for bkash is the media team. The
main objective of this team is to monitor the media, hold events and taking care of the
sponsorship, outdoor branding. Furthermore they are also responsible for giving work order to
vendors and clearing their bills in time after monitoring their work. The media team is divided
into two parts:
 Outdoor &Out-of-Home (OoH) -The work of outdoor &OoH is to managing
all the vendors who are related with the outdoor branding. In addition of this
monitoring the entire outdoor branding element such as billboard, wall paint,

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boat branding. They also find out the new scope of outdoor branding and
planning for the future.
 Event management- In the event team they are constantly on the look-out for
opportunities to brand and sponsor lucrative events, such as: University Seminars,
participate in various fair. Special events are organized during Pohela-boishak,
New year, Victory Day, Eid etc.
Creative Team
The creative team is involved in crucial and sophisticated work for the marketing division. Their
main purpose is to make designs that are to be used for promoting bkash through billboards,
posters, agent point posters and leaflets. Beside this they are also instruct vendors and agents
on the branding item color and design.
Marketing Strategies
bKash is trying hard to popularize their mobile banking services among the customers of rural
and urban areas with some innovative communication in retail stores, television commercials and
in billboards.
 Design and execute all outdoor marketing activities like Billboards, Wall Paintings,
Posters, and Shop Fasciasetc after analyzing the potential target market and the outcomes.
 Plan and supervision for all indoor and outdoor events like participation in Dhaka
International Trade Fair, Chittagong International Trade Fair, E-asia etc.
 Plan and execute all outdoor campaigns with the support from Sales and Distribution
channel
 Make yearly budget partially that properly synchronize with the whole marketing budget
and ensure proper utilization of the allocated approved budget.
 Maintaining strong liaison with other peer departments like Finance, Business
Development etc.

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Marketing Mix
8ps of marketing mix of Bkash:
Product
bKash, a subsidiary of BRAC Bank, provides safe, convenient and easy ways to make payments
and money transfer services via mobile phones to both the unbanked and the banked people of
Bangladesh.
bKash mobile wallet is customer's financial account, into which money can be deposited and out
of which money can be withdrawn or used for various services. Customers are able to receive
electronic money into their bKash accounts through salary, loan, domestic remittance, and other
disbursements and eventually cash-out the electronic money at any of bKash's vast of agent
network of 90 thousand retail points.
Services provided by Bkash:
 Opening Account
 Cash-IN
 Transfer/Sending Money
 Cash-OUT [Agent]
 Cash-OUT [ATM]
 Payment to Merchant
 Buying Airtime
 International Remmittance
 Interest on Savings.
 Salary disbursements by companies to employees.

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Price
Table 7: Pricing Structure and Limitations
Service Amount per
Transaction
Maximum Amount Charge
Minimum
(TK)
Maximum
(TK)
Per Day
(TK)
Per
Month
(TK)
Per Transaction (TK)
Cash-In 50 125,000 125,000 125,000 Free
Cash-Out from
Agent
50 125,000 125,000 125,000 0.925 per 50 taka
Cash-Out from ATM 2,000 20,000 20,000 50,000 Tk. 40 per 2000 Tk.
Transfer/Send
Money
10 10,000 10,000 10,000 Tk. 2 for any amount
Payment (merchant) 1 No Limit No Limit No Limit Free
Receive International
Remittance
50 125,000 125,000 250,000 Free
Place
Bkash has over 80,000 agents across the country ready to deliver their services to anyone that
wants to make use of bkash services. Furthermore they have a helpline to help their customers
with any queries or difficulties they may be facing. Bkash customer care centers can be located
in Dhaka, Mymensingh, Sylhet, Chittagong, Khulna and Bogra.
Promotion
Unique branding and advertising strategy is one of the key factors of bkash’s early leadership
and success in m-banking industry. The marketing team is continuously working to come up

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with innovative advertising and promotional ideas. Hence, they are dominating the market in
term of customer base as well as the market share.
Advertising and branding strategies
 TVCs: Frequent new TVCs for promoting the service.
 Billboards: Attractive large billboard with clear message
 Agent Point: Posters at agents’ shop.
 Wall paints: Advertising through wall painting
 Branding through Vehicles: Car stickers, boat branding, posters on the back of rickshaw
People
bKash follows two types of staffing- customer contact point and Back-end point at bKash. Three
parties are involved in Customer contact point that includes: bKash Agents, Brac Bank, and
Mobile Operators. bKash only staffs their own agents whereas bank and mobile operators use
their existing employees. Therefore, there is no requirement for new staffing in case of bank and
mobile operator. In back-end point at bKash, it staffs for respective functional activities
including Technical, Marketing, and Financial activities.
Process
Agent Registrations
To ensure that customers are being provided quality and professional service, each and every
Bkash agent must meet certain criteria to become a certified agent, a process which can take as
long as six months. As of February 2014, Bkash has over 80,000 agents each of whom have been
appointed after meeting the following criteria:
 Fill up the form available on the Bkashwebstie and submit it to the bKash office.
 bKash will send those application forms to Bangladesh Bank via BRAC Bank.
 Bangladesh Bank evaluates the application to assess the ability of the applicant to
become an agent of mobile financial services.
 If the applicant passes the evaluation, BB will register his or her name as an Agent.

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 The applicant has to open an account with BRAC Bank with his or her Name and Mobile
No. BRAC Bank will provide the agent a DC-No which will be used to identify the
agent.
 Sales Representative (SR) of each area will verify the agent’s address and identity and
will load the account of the agent with the money he or she deposited earlier.
Account Registration
Opening a bkash account on the other hand is much more easier and needs very little time. It is a
one time process, which allows the account holder to use all bkash services. At the moment only
Grameenphone, Banglalink, Robi and Airtel subscribers are eligible for opening accounts, but
Bkash are trying their best to add subscribers of other mobile operators to use their services.
For a person to be eligible to open a Bkash account they must meet the following criterias:
 Is a Bangladeshi citizen
 Must be aged 18 or above
 Must have a valid Photo National ID/Driving License/Passport
 Currently subscribed to Robi, Grameenphone, banglalink or airtel subscribers.
No purchase of new SIM cards are required, an existing SIM is enough to open bKash
account.
If the above criteria’s have been made the following steps are required to open a Bkash account:
1) Go to any nearby bKash Agent along with –
a. One’s mobile phone
b. A copy of Photo ID (National ID/Passport/Driving License)
c. 2 copies of Passport size photographs
2) Fill out the Account Opening Form and put your thumb print & signature properly. One has
to make sure that s/he has taken his/her copy (customer copy) from agent and preserve it
for future reference

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After opening an Account, one needs to activate his/her bKash Mobile Menu. Steps below
tactivate your mobile menu-
1) Go to bKash Mobile Menu by dialing *247#
2) Choose “Activate Mobile Menu”
3) Enter a new PIN for your bKash Account
4) Enter the PIN again to confirm
S/he will receive a confirmation message from bKash. PIN should be kept secret all the times.
The most important factor is that No Charge is applicable for account opening and activating the
account.
Physical Evidence
Bkash which is a service company has some physical evidence to show themselves a productive
service provider towards the customers. This is very important for an organization to promote
them self.
Physical evidence for bkash’s presence,
 14 Hour Helpline
 Customer care centers in six divisions
 Billboards
 Over 80,000 Agents
 Bkash Drama
 Superhero online graphic novel
 Real life story documentary
Productivity and Quality
Bkash has a large customer base, over six million registered subscribers, which allows them to
significantly reduce their unit costs, which in turn leads to economies of scale. This results in
improved efficiency and productivity of their services and allows them to invest more towards
further improving their service quality.

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Finance Division
The finance division is comprised of 4 units.
Central Accounts
Central account is an important unit of the finance division dealing with the budget and fixed
assets. The annual budget of various departments is prepared under the close observation of this
unit. They are responsible for keeping the record of accounts payable and receivables and
reporting.
Costing and Factoring
This unit forecasts the costing of different departments and resorts them regarding the expected
expenditure of any alternation.
Revenue Assurance
This unit consists of the revenue assurance and fraud management. Revenue assurance monitors
the transactions and assures all protection of the finances. On the other hand, fraud management
protects the fraudulences take place in the daily transactions.
Taxation
Taxation unit takes care of the tax, VAT and tariffs of the company.
Human Resource Management
The “People” has been the key success factor that has allowed bkash to achieve so much in a
short span of time. Thus Management of bkash strives to hire, engage and retain talented
employees. Human Resources Strategy of bkash constantly grows and renews its commitment to
meet the career aspiration and priorities of the employees. Bkash views their employees’ as most
valuable capital of the organization and is endowed with unique qualities and if thoughtfully and
inspiringly led the workforce can bring superior result with creativity. In line with the growth
aspiration of the mobile banking provider, the management of bkash carefully identifies potential
future leaders amongst its employees and takes extra ordinary effort to build them.

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Things bKash Does to Attract Top Quality Management
As a modern and fast growing company in the mobile banking industry, Bkash covets
hardworking and talented employees with right set of intellect and allows them accelerated
carrier progression in the company
The bank has been successful in recruiting quality people and retaining talents from the day of its
inception. Bkahs actively pursues hiring the “best fit” according to business need and respecting
organizational values through proper human resource planning, using effective assessment,
methodology, ensuring efficient process and establishing and maintaining strong employer
brand.
Employment Opportunities and Facilities of bKash
bKash is compensating its employees with market oriented packaging deals. It makes the
employees as the integral part of the company and helps them to contribute in the companies
operations. bKash believes its employees as its assets who is responsible in making a mark in the
industry for the company. Performance Management System (PMS) is helping the employees in
identifying and delivering against the challenging goals. bKash tries to develop its employees as
leader so that they can help the company in the future.
Some Terms of Employment at bKash
Probation
All employees recruited on a permanent basis have to undergo a period of six months as
probationary period to ascertain their capability and suitability for employment and are judged
with a performance appraisal at the end of fifth month.

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Punctuality
bKash is very particular about time. Employees are required to arrive at work before 9:00 am. In
case of disregard of this rule the action is treated as late and recorded in the Attendance Register
accordingly. Similarly if the employees leave the work without authorized permission before
5:45 pm is treated as indiscipline.
Duration and Procedure of Leave at Bkash
For motivating and make the employee effective bKash HR department give their employees the
following leave system or vacations
Annual Leave
 Medical Leave
 Accident Leave
 Maternity Leave
 Paternity Leave
 Leave Without Pay
 Compensatory day-off
 Encashment of annual leave
Salary and Benefits
Bkash offers great platform to build one’s career with learning and career growth matched with
compatible compensation and benefits in an enjoyable, enabling and ethical working condition
with highest level of professionalism. Besides the competitive compensation package, some of
the lucrative benefits that employees of bkash enjoy are:
 Leave Fair Assistance;
 Hospitalizaion Insurance for employees and their spouse and childern;
 Festival and Performance Bonsues;
 Providednt Fund,

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 Gratuity; House Building Loan, Staff Loan, Car Loan at heavily discounted rate of
interest.
Career Development
Bkash being a subsidiary of BRAC offers a wide array of careers for individuals of various
educational and experience backgrounds. Working in bkash is a respectable profession and gives
a person many experiences to either move up in same department or move on into other
department. An employee can grow both in upward and latterly within bank by getting
promotion, job rotation, transfer to another division and can flourish & go further at the top.
Motivation
As motivation is a prime factor to job satisfaction, Management is willing to take initiative by
offering schemes:
 Performance Bonus
 Reward and recognition
 Safety and security
 Social and voluntary activities
 Scholarship program
 Donations
 Maintain Discipline
 Punishment
 Right of Appeal
 Retrenchment
 Medically Boarding Out
 Retirement

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Information Technology Division
The Distributed Transaction Platform deployed both at the mobile operator’s site and at the
financial institution securely manages financial operations carried out between the mobile user
and the bank, over the wireless network.
Specifically, this platform:
 Maintains communication between the SIM card and the financial institution
 Routes mobile banking messages
 Manages mobile banking sessions
 Securely handles sensitive information
 Ensures the confidentiality and security of mobile transactions
 Manages user information
 Authenticates users.
Security Strategy
Security and Confidentiality of Information: The Mobile Banking solution provides end-to-
end security and confidentiality of data by ciphering information in the SIM for secure transfer
over the mobile phone, the GSM network, the operator’s infrastructure and the connection to the
financial institution. The information entered by the user is collected and encrypted by the applet
residing in the tamper-proof SIM card.
Strong Two-factor Authentication: Bank customers must be sure that no one can make
transactions on their behalf, and banks must be able to verify that customers are indeed who they
claim to be. bKash responds to this requirement with strong two-factor authentication. Users are
required to identify themselves to the bank with a Mobile Banking PIN that protects access to
financial information and transactions. Secret keys only known to the SIM card and the bank are
used to encrypt and sign transaction data, further proving the identity of the user.
Data Integrity: Since data is digitally signed, any attempt to manipulate it will be detected
because the signature will no longer correspond to the signed message.

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Non-repudiation: Non-repudiation refers to authenticating the customer and the financial
institution participating in a financial transaction with high degree of certainty. To ensure non-
repudiation, a proof must be generated to show that the transaction was performed by that party.
bKash Mobile Banking addresses this requirement through the use of:
 A user PIN known only to the user and protected by encryption
 A transaction confirmation code sent by the bank
 A transaction log that records the details of every transaction.
Network Coverage
The number of areas covered by an operator justifies network Coverage. Since bkash is partnered
with all the major mobile network operators, Grameen phone, Banglalink, Robi and Airtel, they
are able to cover 61 districts, that means their services are available in 95% of the country. All
MNOs at the moment use the most advanced technologies for cellular communication known as
GSM (Global System for Mobile Communication). It is a European based technology. In
addition the MNOs get technological support from Huawei and Ericsson. Huawei is a Chinese
based company involved with telecom instrument support business more than 15 years. Another
one named Ericsson is a Swedish telecom instrument support company that is involved with this
business for more than 50 years. It is now doing its operation in more than 180 countries. This
strong network coverage and strength can easily attract and retain Bkash target customers,
providing them with a solid customer base.
Linking the Resources,Core Competency,Capabilities withFunctional
Level Strategies for Value Creation
For a company to gain competitive advantage, it must do so by making efficient and innovative
use of both its resources and capabilities, to build core-competencies, which through the

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implementation of effective strategies can be transformed into the company’s comparative
advantage.
The resources of Bkash include:
 Strong Customer Base,
 Brand Value and recognition,
 financial resources, country wide coverage,
 strong network of agents, accessibility,
 and wide range of services.
Capabilities of bkash include:
 Providing an efficient, competitive and simple mobile banking
 Marketing and Branding
 Maintaining customer relationship
 Raising funds from international donors
 Continuous partnership establishment with business and ngo to provide payment services
 Maintaining and developing technology platform.
 Convenient and accessible to clients
 Availability of cash
 Nationwide service through agents
 Fast transactions with help of MNOs
 Cost Effective service
 Risk reduction by providing security

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The above capabilities and resources have enabled bkash to develop core competencies of Brand
recognition and Strong Agent network.
Which have given them comparative advantage over their competitors DBBL and Islami Bank
with greater brand recognition among target customer base, and a stronger agent network across
the country through effective marketing their financial services more aggressively as well as
carrying out extensive scanning and evaluating candidates, with the help of Bangladesh Bank, in
their appointment process for certified bkash agents.
Now bkash has been able to maintain and sustain their competitive advantage through the
following means:
 Superior efficiency: Bkash has superior efficiency in terms of their strong agent network
of 80,000 catering to the needs of over 6,000,000 active bkash users; so every bkash
agent handles 70 bkash users. The superiority in efficiency is made clear when we look at
70,000 agents of DBBL who are looking after about 2,000,000 DBBL mobile financial
service users; that is one DBBL agent provides service to about 28 DBBL mobile
financing account holders.
 Superior Quality: Bkash tries to maintain superior quality by screening and evaluating
potential bkash agents, who work as field representatives for bkash, with the help of
Bangladesh bank to check their credentials and ability to be a bkash agent. This ensures
that bkash’s agent network is formed of reliable and efficient individuals, allowing them
to maintain their strong agent network as a competitive advantage.

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Furthermore bkash’s marketing division tries to bring quality to promoting their services
through billboards, posters, boat branding and online graphic novels by making their
advertisements be visually appealing as well as having easily visible and understandable
information regarding their mobile financing services. Bkash also uses tvc and drama
targeted at the rural customers, who are their primary target market, to better relay their
message and gain recognition among the rural customers.
 Innovation: Bkash has brought innovation in marketing their services through
introduction of boat branding and developing a super-hero online graphic novel, Spark,
this has helped bkash immensely in maintaining superior brand recognition over their
rivals.
 Superior Customer Responsiveness: Bkash has tried to provide superior customer
responsiveness with the help of their massive network of certified bkash agents, 80000
across Bangladesh. On top of that they have customer care centers in all 6 districts with
an application form available online for any queries customers may have regarding
bkash.
Bkash has also tried to focus on providing most important financial services to their
target customers and ensure their services are available to them in a timely and reliable
manner by constantly upgrading their software and running routine maintenance.

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Figure 18: Functional Level Strategies
Resources
 Strong Customer Base,
 Brand Value and recognition,
 financial resources, country wide
coverage,
 strong network of agents,
accessibility,
 Wide range of services.
Distinctive Competencies
 Brand Value Recognition
 Widest range of Agent Network
Capabilities
 Providing an efficient, competitive and simple mobile
banking
 Marketing and Branding
 Maintaining customer relationship
 Raising funds from international donors
 Continuous partnership establishment with business
and NGO to provide payment services
 Maintaining and developing technology platform.
 Convenient and accessible to clients
 Availability of cash
 Nationwide service through agents
 Fast transactions with help of MNOs
 Cost Effective service
 Risk reduction by providing security
Strategies For
 Efficiency
 Innovation
 Quality
 Customer
Responsiveness
Simple &
Reliable Banking
via Mobile Phone
Differentiation and Cost
Reduction
Superior
Profitability

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Company Structure and Control System
Division & Departments:
bKash consists of 8 big divisions each containing several departments according to the
division & organizational need. A Chief Executive Officer/Managing Director heads the
organization. Each division is headed by CXOs & either an EVP or VP heads each
department but sometimes EVP holds responsibilities of more than one department. General
Managers are there to coordinate between departmental heads & employees. Managers are
given specific tasks, programs, plans or analysis to be done. Specialists & Officers are entry-
level positions that perform different types of job given by managers or general managers.
Here is a brief of all the divisions. However, chain of command for top management & each
division is shown in Appendix II.
a. Commercial Division:
Commercial Division is responsible for acquiring monthly targeted sales given by top
management. The division works to develop brand & market communication, sales of
corporate & business products, maintenance of contact center as well as participate in
building up pricing strategy of new products.
b. Finance and Accounts Division:
Finance is the heart of any business functions because they are responsible for budgeting.
Finance division of bKash is accountable for financing into different proposals, business
partnering, as well as new product development. Finance controls financial accounting,
creating salary sheets for employees, maintaining compliances & so on. SCM & corporate
finance is another task of this division.
c. Corporate Affairs & Legal:
This division is known as CRL, which is in charge of all the CSR activities approval, analysis
of event management & sponsorship, maintaining relations with media, handling legal issues
by govt. & so on. Two of the most renowned faces are incorporating the division.

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d. Human Resources:
Human resource or HR mainly works for recruiting new employees, providing training for
existing employees; circulate salary to employees’ account, employee motivation, as well as
organizational development. HR also takes the responsibility of maintaining good relations
among all the employees.
e. Technology:
It is the division, which provides IT support to all the divisions & departments of bKash.
Main tasks of this division is maintenance of regional IT operation along with establishing
BTS, central network monitoring, technology compliance, supporting employees by
providing necessary hardware & software, support contact center etc. Controlling bKash
website as well as intra-division & departmental websites is also an important task of
technology.
f. Administration:
Administration division works to control the business facility layout, safety & maintenance,
controlling overall employee management, security staffs & personnel management etc.
Besides, maintaining alternative sites for emergency evacuation is also a part of
administrative job.
h. Customer Service Division:
Customer Service Division works closely with the CXOs in developing or participating
different management programs. This division is solely responsible for customer service
segments. Along with the Corporate Strategy division, this division defines business
objectives, goals, policies for business & contribute for dissimilar projects to take place.

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Top Management
Kamal Quadir
CEO
Nishat Rahman
Head of customer Service
Mohammad Azmal
CTO
A B M Sazzad Hossain
Head of Corporate Affairs
Mahmood Abdullah Harun
Manager, Human Resources
Moinuddin
Mohammed Rahgir
CFO
CFO
Major Md. Najmul Ahsan
Head of Administration
Rezaul Hossain
COO

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Finance
Technology
Mohammad Azmal Huda
CTO
Md. Mizanul Ghani
EVP, Central Operation
Asif Rahman
EVP, Planning
Sarker Sohel Ahmed
VP, Implementation
Md. Rezaul Karim
VP, Compliance
Niloy Rahman
VP, Development
Md. Anisur Rahman
VP, Regional Operation
Moinuddin Mohammed Rahgir
CFO
Awlad Haider
EVP, Business Partnering
Zuabir Alam
EVP, Business Control
Mostafizur Rahman
VP, Corporate
Secretarial
Md. Saif Khaled
VP, SCM
Dewan Nazmul Hassan
VP, Corporate
Finance
Biplob Ghosh
VP, Financial
Accounting
F. M Fazle Karim
VP, Revenue Assurance

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Commercial Division
Corporate Affairs & Legal
A B M Sazzad Hossain
Head of Corporate Affairs
Humayun Kabir
VP, Company Affairs
Segufta Yesmin Samad
VP, CSR & Sponsorship
Muhammed Shahedul Alam
VP, Legal & Compliance
Alloisus Mohan Ramaiah
VP, Regulatory Affairs
Mohiuddin Babar
VP, CorporateComm. & media Relation
Rezaul Hossain
COO
Rony Khandakar
EVP, Brand & market Comm.
Kais Uddin
EVP, Consumer Sales
& Services
Promod Ranjan Karmaker
VP, Contact Centre
Manjur-E-Elahi
VP, Market
Strategy &
Pricing
Manjur-E-Elahi
VP, Market Strategy &
Pricing
Sadat Adnan Ahmad
VP, Product & Service
Nazir Ahmed
VP, Sales & Service
Emerging Market
Shiblee Shakik Ahmed
VP, Business Sales &
Service
M.A.H. Ruhel Abedin
VP, Media Management

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Administration
Customer Service Division
Nishat Rahman
Head of customer
Quazi Sarjil Ibne Sarwar
VP, Project Management
Shamsuddoha Mohammad Shafie
GM, Project Management
Mohammad Atiqul Haque Siddique
Md. Iftakharul Islam
GM, Project Managemen
A.N.M Shibly Sadique
Major Md. Najmul Ahsan (Retd.)
Head of Administration
Md. Mostak
Ahmed
GM, Safety
Management
Raushon
Ahmed
GM, Regional
Admin
Operation
Jamil Ahmed
GM, Security
Management
Muhammad
Taha Alamgir
GM, Facility
& Estate
Management
Akter Emam
Khan
GM, Fleet
Management

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Human Resources Division
Mahmood Abdullah Harun
Manager, Human Resources
Md. Faisal Imtiaz Khan
VP, Employee Relations
S. M. Farhad Mahbub
VP, HR Operations
Md. Tauhidul Alam
VP, Competence Dev
Rizwan Hamid Quraishi
VP, Organizational Dev.

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Corporate Governance
Board of Directors
Mr. Muhammad A.
(Rumee) Ali
Chairman
Nihad Kabir
Director
Professor Dr. Jamilur Reza
Choudhury
Director
Mr. Shameran Abed
Director
Mr. Syed Mahbubur
Rahman Director
Mr. Arun Gore
Director
Mr. Nicholas Hughes
Director
Mr. Iqbal Quadir
Director
Mr. Shib Narayan Kairy
Director

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The Board of bKashis committed to transparency and accountability, consistent with good
corporate governance and practices. They play a pivotal role in ensuring this across the
Group, towards the protection of all their stakeholders including minority shareholders and
partners. bKash recently appointed two new Directors in their effort to continue
strengthening their Board.
Shareholders
The stockholders of bKash encourage the top-level managers to pursue strategies that
maximize company’s long run profitability and profit growth, and thus the gains from
holding its stock, by linking the pay of those managers to the performance of the stock
price.
Auditors
Internal Auditor
bKash has an internal audit function that acts as an independent appraisal function by
examining and evaluating the adequacy and efficiency of the company’s system of internal
control. Internal audit resides administratively within the chief financial officer’s
organization and report s to the audit committee of the board of directors. This department
has all time direct access to the audit committee without any involvement of the
management.

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External Auditor
The external auditor of bKash elected annually by their shareholders at the AGM of the
company. The audit committee of the board of directors makes a proposal to the
shareholders in respect of the appointment of the auditor based upon its evaluation of the
qualifications and independence of the auditor proposed for election on an annual basis.

112
Company Structure and Control System

113
bKash has also other controlling system for their employee. Controlling is basically
important for better performance performed by employee. Also It is important for a
company to make their employee more efficient and effective and also to make them
perform with best quality and make them innovative and to improve their communication
skill with customers and responsiveness to customers. There are basically three types of
controlling that bKash does.
 Personal control
 Output control
 Behavior control
Personal control:
Personal Control is the desire to shape and influence the behavior of a person in face to face
interaction in the pursuit of the company’s goal. For bKash this is more applicable because
managers can questions and probe subordinates about the problems or issues they are
facing to get a better understanding.
Output control:
Output control is a system where managers’ estimates or forecasts appropriate
performance goals for each division and employees and then measures actual performance
on these goals. It motivates the employees. For bKash it is going in to a broad focus
business in the future can help to keep track of the business by implementing this control
system. Also manager make some goals for their employees and also they give a certain
period, they also measure the actual performance done employee considering the given

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time. They measure the actual performance comparing with standard they create employee
and what have done by them with in a given period.
Behavior Control
bKash also control their employees behavior bye training motivating them or by
communicating and talking with them to make them more efficient and more productive.
bKash standardize three type of behavior control.
Input
bKash enhance, empower, give them proper knowledge and information and motivate their
employees by training and by several activities. bKash make their employee enough skillful
by controlling them in various way.
Conversation activities
Also bKash give their employees some code of conduct and also some rules and regulation
that the employee must have to follow. And also bKash manage always communicate with
their employee and take feedback about their work and problems, response their concern
etc. by conversation bKash top and other manager can control other employee
Output
Finally management of bKash control employee by their activities done and what was
expected from that employee after comparing if they find any lacking then bKash
management take all necessary steps.

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Controlling employees’ personal output and behavior bKash can make their employee more
loyal and efficient. Controlling can create a fear of punishment among employee so those
employees try to give their best, which can bring success for company. Controlling employee
also guide them to follow the strategies that bKash has taken for their business. Also
controlling employee can motivate them and create a fear so that employee follow the
business strategy bKash and try to give the best performance and service that bring good
outcomes and customer satisfaction and information and also make unique and differential
than others.

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Value chain analysis
Figure 19: Value Chain Analysis
Social innovation
Bkash is in the process of creating value with the help of idea generation through the
customers themselves. With Bangladesh being the fastest-growing mobile money market in
the world, they can do with this technology to improve the lives of the clients and their
efficiency. They took this question and posed it to the wider BRAC community, mobile
money experts, and development practitioners from across the world, and anyone with ideas
on how BRAC can offer better services and improve operational efficiency. In March 2014,
they launched their first challenge for the BRAC Innovation Fund for Mobile Money through
an open online platform where anyone could submit their ideas, comment and vote on other
Social Innovation
Mobile top- up
service
Affordable
services
Nationwide
coverage
Brand image
BRAC Innovation Fund
Specialized service provider
Staffs and Agents
Customer service centers
R & D department

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ideas. Ideas that were selected include: micro pensions, mobile money for relief assistance
and paying BRAC’s frontline workers through bKash. The entire process is aimed at the
customers realization that Bkash values the customers’’ needs and thoughts.
Bringing mobile top-up service:
In 2014, Mobile financial service provider bKash has launched 'Buy Airtime' service
allowing the bKash wallet users to top up mobile balance of Banglalink, Robi and Airtel
numbers through bKash. According to a statement, any individual bKash wallet user can
recharge his/her own or someone else's Bangalink and Airtel connection, both prepaid and
postpaid, and Robi's prepaid connection through this service and no additional charge is
applicable for buying airtime through bKash; opening of bKash wallet is also free of cost.
Affordable Services
Send and receive money with minimal effort and cost. bKash provides the highest benefits to
its customers at an affordable cost, enabling everyone to access the formal financial system of
the economy. People can avoid additional costs that incur by opening bank accounts.
Moreover, bKash greatly minimizes opportunity costs such as time and effort required to
access such services. The service charges are minimal and there are no hidden costs involved.
However, People can open a bKash Wallet free of any charge on their own mobile and can
experience how bKash saves unexpected and incidental costs.
Nationwide Coverage
BKash has the nationwide coverage with their huge network. It is the easiest and safest way
to send or receive money instantly on mobile, nationwide. According to the report of 2013
Bkash has more than 500 staffs and 80,000 agents covering each district and Thana along
with around 300 BRAC Bank ATMs provides with the nationwide reach and capacity that the

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customers need to avail bKash services at a close proximity. Moreover Bkash has its spread
even on the remote areas of Bangladesh. In addition, Bkash has their customer service centers
at 6 different zillas in Bangladesh: Dhaka, Mymensing, Sylhet, Chittagong, Khulna and
Bagura.
Brand Image
BKash Limited, a subsidiary of BRAC Bank, started as a joint venture between BRAC Bank
Limited, Bangladesh and Money in Motion LLC, USA. Although bKash is neither a MNO
nor a bank and it is a separate company that built its business on its own and scaled up
quickly this business was initiated by the conglomerate BRAC which has a strong brand
image in the market. Even though Bangladesh’s central bank has approved more than 20
licenses to offer mobile financial services, more than 80 percent of transactions are through a
single company—bKash Limited. Because of the strong brand image that BRAC has people
can easily rely on bkash to complete their financial transactions.
Primary Activities
After forming a joint venture between BRAC Limited, Bangladesh and Money in
Motion LLC, USA the result was a subsidiary named Bkash.
Secure license from the central bank in order to deliver mobile financial services.
Establishment of relationship with the mobile phone operators of Bangladesh:
Grameen phone limited, Banglalink Digital Communication Limited, Robi Axiata

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Limited, Airtel Bangladesh Limited, Pacific Bangladesh Telecom Limited (Citycell)
and Teletalk Bangladesh limited.
Establishment of customer service centers at 6 different zillas in Bangladesh: Dhaka,
Mymensing, Sylhet, Chittagong, Khulna and Bagura.
Deliver extensive marketing and promotional activities throughout the nation.
Support Activities
Recruitment of 500 staffs and 80,000 agents
Technological development to maintain network of 24 hours without any disruption

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Strategic Analysis (4P)
Strategic analysis is used to understand a company’s strategy based on their Position,
Priorities, Payments and performance. We tried to analyze the strategies of bKash through the
4P framework.
By completing the framework, we can analyze the company’s current, future, or
recommended priorities as well as set forth a path in order to achieve goals and measure
accomplishments.
Position
Position part is comprised of mission, vision and values of any company. The mission of
bKash is- by providing financial services that are convenient, affordable and reliable; bKash
aims to widen the net of financial inclusion. bKash wants to provide a solution for Mobile
Financial Services, built on a highly scalable Mobile Money platform, allowing the people of
Bangladesh to safely send and receive money via mobile devices.
The vision of the company is to ensure access to a broader range of financial services for the
people of Bangladesh. It has a special focus to serve the low income masses of the country to
reliable. The core values are comprised of integrity, quality, reliability and innovation.
Priorities
The main priority of bKash is to provide a safe and reliable way to receive and send money
through mobile phones to their target customers. They also focus on innovation for improved
efficiency. As a company capturing the market share also lies in their mind.

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Payments
The payments part describes the company’s way of investment or other costs that may be
incurred by the company. bKash incurs most of its costs from the fees given to the network
provider and commission given to agents. Technology to build a highly scalable mobile
money platform, advertising and other fixed costs are also included in the payments section.
Performance
The performance showed how successfully the company is doing the business. The use of
bKash service is increasing day by day. It is gradually becoming the most popular way to
transfer money. It is capturing plenty of market shares and currently is the market leader of
the mobile financial services market in Bangladesh. It is estimated that it has around 2.2
million users in the market right now. So it is performing very well indeed.

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SWOT Analysis
A SWOT Matrix is a study undertaken to identify the internal strengths and weaknesses, as well
as his or her external opportunities and threats of an organization. After accomplishing the task
of identifying the strengths, weaknesses, opportunities, and threats in points, the analysis has
been performed below.
Strengths
The mission statement of bKash is based on the distinctive core competencies it possesses. In
matching with one of the distinctive core competencies, vast agent network, bKash has
established its mission of providing financial services in a wide manner that are convenient,
affordable, and reliable for the target group. The distinctive agent network and brand recognition
differentiate bKash from its competitors, thus strengthening its position in mobile banking
industry.
In terms of utilizing their strengths properly
In case of justifying with the own competencies bKash is doing it properly. Their success is the
prime evidence of their utilization of strengths. In an oligopoly industry when there is little scope
for differentiation, bKash is taking revolutionary steps to differentiate itself from the immediate
competitors. Its unique advertisement and marketing strategies, partnerships with major MNOs
and affiliation with foreign investors play significant role in strengthening its position as mobile
financial service provider. However, the innovation in offering services is like the cherry on the
top in adding value for the customers and tagging bKash as the market leader from the inception
till now.

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How bKash can work on improving and maintaining its position?
Being the all time leader it is hard to identify the flaws from the best and it is even harder to
maintain the current position in future. The vast agent network is the biggest strength of bKash
which requires a huge financial investment and smart marketing strategies to apply. However in
order to improve and maintain the network position bKash must encourage a decentralized
management system where each of the employees idea would be valued and must invest in R &
D sector to eliminate any kind of noise during money transaction. In addition, bKash must work
on creating value for their customers by offering its services at the lowest possible rates
compared to other competitors so that it leaves a zero of overtaking its leading position.
Weaknesses
Being a market leader in a nation it is often difficult to figure out the weak points of the
organization and it is no different for bKash. bKash being the market leader is not so perfect in
providing financial services to its customers. The high service charge makes bKash a less perfect
one. After the 3I analysis it is found that bKash is heading back in terms of differentiating itself
from providing services at the lowest rate. In a world of competition there is no space for
compensating widespread quality service with high service charge because the buyers are not
willing to compromise with their expense. In an oligopoly industry when the bargaining power
of buyers is moderate there is no chance for bKash to continue its journey with such a weakness.
Turning weaknesses into strengths
One of the most challenging jobs for a company is to turn its weaknesses into its strengths. In
case of providing services bKash requires to change its limited monthly transaction amount to an
unlimited one and decrease cash unavailability to zero so that customers can have no complaints

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against bKash services. However satisfying customers does lie with a crucial matter of providing
external security as well but it is mostly influenced by the external environment of the country.
On top bKash should also encourage decentralized management system and offer employees
with attractive compensation packages so that retention rate does not fall and talented employees
can get the platform for innovation and creativity.
Opportunities
The increasing number of population where a massive market is occupied by low income people
is one the biggest opportunities for bKash. In a market of oligopoly where there are only a few
numbers of competitors and the threat of new entrants is low, the doors of opportunities are
widening for a leader like bKash. Additionally, technological advancement of Bangladesh with a
motto of building a digitalized country is adding value in case of innovation in the services and
thus the acquaintance with the new services by the customers in their day to day lives is a good
sign for bKash. bKash has mainly gained its position from the opportunities like inconvenient
traditional banking hours, difficulty in maintain a bank account, and hassles in traditional bill
payment. On top, the wide network coverage by major MNOs provides bKash with the
opportunity of maintaining its biggest strength, the vast network service.
Turning opportunities into strengths
bKash is good enough to turn its opportunities into strengths. bKash with its talent human
resources and vast network coverage can come up with some more convenient and affordable
services and dig into the most remote areas of the country where traditional banking services do
not reach. Such an effort can give bKash the distinctiveness and buyers can more easily
differentiate bKash from the rivals. However, bKash can utilize the growth of different

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businesses by offering different service packages for transactions in different businesses and thus
can strengthen its position and rule as a differentiator.
Threats
How external environment has created threats for the company?
Sudden change of rules, regulations and policies can become a big threat for bKash because in
future government may allow telecom companies to do mobile banking services of their own.
From Porter’s five forces we came to know that bargaining power of suppliers is high that means
the network operators can start charging higher prices for using their good network quality. On
the other hand we can see now a days some people are misusing the MBS by doing financial
criminal activities which eventually hampering the reputation of this mobile banking industry
and keeping people away from using MBS. As bKash is dealing with people’s money that means
their trust, they need to be very alert in all aspect because a simple mistake can be a headline of
the newspaper and by that media may start yellow journalism for which bKash may have to pay
the price.
How the threats can become company’s weaknesses and hence lower their profitability?
The threats are alarming for the company and it may not take while for them to become their
weaknesses. As there are very few good network providers, the MNP can continuously charge
higher prices which will force bKash to increase their service charges even further to their
customer. Moreover, day by day financial crimes are increasing, so bKash will need to improve
their IT department efficiency to control and monitor such crimes otherwise it will become a
major weakness for bKash.

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ProposedBusiness Model
To survive in the dynamic nature of contemporary business environment, every business should
continuously improve its business model. Current business model of bKash has rewarded them
with a market leadership and largest customer base, but they must improve their model with the
demand of the customer. Therefore, we are suggesting the establishment of strategic alliances
and new product development that would help add more value to the company reduce cost and
create more differentiation.
Strategic Alliance:
I. Google Play, Apple App Store, Microsoft Market Place
Mobile application markets such as Google Play Store, Apple App Store, MS Market Place are
enriched with millions of application and most of the full featured apps must be purchased
online, via credit card, debit card or PayPal, before users can download them. BKash should
form strategic alliances with these markets to facilitate payment for paid applications. Thus
bKash can attract more customers particularly younger generation who do not own an
international credit card.
Making online purchases using ones mobile phone has already been a fruitful venture shown by
the U.S Company Boku. Bkash already has partnership with all the major mobile operators in
Bangladesh, but it would still require substantial corporate level effort, technological investment,
and security, but with the help of their financial backers and partners, BRAC, Money in Motion
and Visa, they can reach an agreement with online retailers of virtual products to become an
alternate payment method for users of Google Play, Apple App Store. The mobile apps industry
is rapidly growing and demand is continuously growing even in Bangladesh. If bKash can

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establish a payment system to facilitate the purchase of products from these online app stores, the
company will have a first mover’s advantage and bKash, has to make it happen as soon as
possible. We believe that if an easy method of payment like bKash can facilitate payment service
in app stores, it will enlarge the customer base, maybe even expand to neighboring countries of
India and Pakistan, and add value to the company. In addition, bKash will be able to differentiate
itself from its competitor by higher degree.
Initiatives for this strategy
 Corporate level Managers must negotiate with Online App Stores ( Preferably Google)
and persuade them to the strategic alliance
 Establishing payment system in the app store. Investment should be shared by both bkash
and the app store since both parties will enjoy the benefit.
 Cross boarder fund transfer (in between bKash and app store) and currency risk can be
managed by Brac Bank ( since bKash is a subsidiary of Brac Bank)
 Online transaction security must be confirmed.
 bKash must heavily advertise this service in innovative ways to reach highest number of
customers.
II. Micro-Finance Institutes
There are many organizations (including BRAC) that provide Micro-Finance service to the rural
areas of Bangladesh. These types of organizations are a great opportunity for bKash. The deposit
and loan amount are typically very small and but the number of transactions is large. So, bKash
can create strategic alliances with micro-finance institute to facilitate loan disbursement, loan

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repayment and other micro-finance services. bKash can add efficiency in micro-finance service
and generate revenue for itself.
This alliance will create more customers increase differentiation, add value to the company.
III. Developing new Products/Services:
Currently bkash only provides the following services:
 Opening Account
 Cash-IN
 Transfer/Sending Money
 Cash-OUT [Agent]
 Cash-OUT [ATM]
 Payment to Merchant
 Buying Airtime
 International Remmittance
 Interest on Savings.
 Salary disbursements by companies to employees.
It acts as a medium of transferring money from one business to another. Bkash can expand the
services they have to offer by introducing new services such as micro-pensions and micro-dps, in
conjecture with Brac Bank. This would enable any registered bkash user to make their routine
payments required by pension schemes and dps through their mobiles, saving them the hassle of
physically going to designated banks to deposit the money. Furthermore upon maturity the user
can receive their payments directly to their bkash wallets, making it a much safer method of
receiving their money.

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Cost Minimization Differentiation
Value Addition
Security
Two factor
Authentication
Data Integrity
Confidentiality of
Information
No Repudiation
Visa
Technology
ATM Cash-out
Agent
Network
Stronger
Customer
Base
Channel
Distribution
Outsourcing
More
Economies of
Scale
Low Fixed Cost
Branchless
Banking
Countrywide
Service
Training &
Motivation
Commission
Simple Process
No A/C
Opening cost
Productive
Employees
Performance
Management
CompetitiveCompensation
Career
Growth
Bran
d
Value
Major MNOs
Partnership
Educational
Institutes &
Hospitals
Bill Payment
Remittance
Businesses
Creative
Advertisement
Revenue
Collection
Effective
Branding &
Marketing
Product Development
Salary
Disbursement
Good Customer
Service
Customer
Responsiveness
Strategic AllianceMicro-Finance
Institutes
Google Play Store, Apple App
Store, MS Market Place
Online Payment System for E-Business Figure 20: Current Business Model of bKash
Micro DPS & Micro Pension

130
Conclusion
bKash has established itself as an early market leader of Mobile Financial Service or m-
Banking Industry by creating stronger brand value and implementing share building strategy
at embryonic stage of the industry. As the industry continued to grow, bKash continuously
expanded its operation and range of service. Marketing department and the Creative Teams
have been playing key strategic roles to place bKash at gaining competitive position and to
differentiate from its competitors. However, the industry has the characteristics of Oligopoly
Market and the competition will intensify in near future. So, bKash’s differentiation strategies
may not be feasible for a very long time. bKash should focus on cost minimization and adopt
cost leadership strategy to survive in the market.
Even though current strategic decisions have rewarded the company with early leadership,
but strategies must be improved and redesigned to persist as a market leader. Rapid growth of
the industry and increasing number of competitors are driving the need for functional level,
business level and corporate level strategic decisions. bKash should reevaluate and improve
functional, business and corporate level strategies to prepare itself for more intense
competition. Implementation of following functional, business and corporate level strategic
recommendations should help the company to protect its position in the market.

131
Recommendation
Corporate Level Strategies:-
 Tapper integration: bKash can open bKash centers in every area where it operates.
In this center people can come and enjoy the regular bKash services. They can also
get all kinds of help regarding bKash (eg. Opening a bKash account). This center will
also be a solution for the safety of the agents. Agents don’t need to keep the money
from bKash to themselves if these centers are available. These centers will be heavily
guarded and agents can come and take money whenever they need it. In this way,
agents do not need to travel far to bring and give back the money and the risk is lesser
in terms of safety. It will also be a solution to cash unavailability.
 Strategic Alliance: We have discussed to need of distinctive strategic alliances that
bKash can pursue to differentiate itself from the competitors. Strategic Alliance with
Google, Microsoft Corporation, Micro-Finance Institutes will open more
opportunities for bKash. Strategic Alliance is a long process and bKash must take the
advantages before its competitors do. So, they must negotiate with the relevant
companies as soon as possible.
 Product development:
I. Online Payment System Development: E-business is emerging in Bangladesh
and bKash must capitalize this opportunity by facilitating online payment
service. The service requires a new payment system development which is
possible with current technology (Visa). Initially it can start with strategic
alliance with Google Play Store, Apple App Store and other online software
sellers. With the experience curve and learning effect bKash will be leading
online payment system developer in Bangladesh. New system and

132
infrastructure cannot be built overnight, so bKash must take corporate level
initiative to start developing system and infrastructure for online payment.
II. Micro-DPS & Micro-Pension: Bkash can expand the services they have to
offer by introducing new services such as micro-pensions and micro-dps, in
conjecture with Brac Bank. This would enable any registered bkash user to
make their routine payments required by pension schemes and dps through
their mobiles, saving them the hassle of physically going to designated banks
to deposit the money. Furthermore upon maturity the user can receive their
payments directly to their bkash wallets, making it a much safer method of
receiving their money.
III. Relaxing Transaction Limit: Transaction limits have been preventing many
SME businesses to use bKash service. bKash should come with new products
specially designed to meet SME transaction needs that would offer relaxed
transaction limit for those SME customers.
IV. Currently bKash fund transfer does not refer who is sending the money if the
money is sent through agent. bKash should modify its system to enable
receiver to identify the sender. In this case, the sms the money receiver should
contain the name of the money sender.
Business Level Strategies:-
 Cost Leadership: In the long run bKash needs to focus more on becoming the cost
leader among the companies in the industry. As plenty of competitors are coming in,
the differentiated strategy of bKash will surely be imitated. And though continuous
innovation should also be a priority; reducing the cost and charging less prices for
their services will be the key to sustainability. Because consumers will move to the
competitors as they are also starting to offer the same services as bKash. Moreover,

133
m-banking industry is Oligopoly in nature where scope of differentiation is limited.
Therefore, shifting the business model to lower cost structure should be implemented.
In banking industry most of the costs are fixed and there is a substantial cost
associated with employees. So, bkash should put a significant amount of effort to
identify unproductive employees to reduce the cost through implementation of strict
controlling and performance evaluation systems. bKash must get rid of unnecessary
and unproductive employees to lower its cost. Moreover, bKash should offer better
compensation packages to attract more productive employees to continue its operation
with higher efficiency and lower cost.
Functional Level Strategy:-
 Cash Management System: Sometimes unavailability of cash is creating
dissatisfaction among customers and it has a severe chain effect on profitability.
bKash should adopt a de-centralized cash management system. There should be 10-
12 cash management units covering all the country and connected with each other
through IT network. Each unit will estimate and forecast daily cash need for their
assigned geographic location and facilitate cash from assigned banks. Cash
management units can use Miller and Orr Uncertainty Model to forecast daily cash
need. By doing this bKash cash management units can avoid access cash or
unavailability of cash for their assigned geographic location and facilitate cash from
assigned banks.
 System Improvement: In many cases bKash customers cannot avail the service due
to system failure when the face massive quantity of transactions at one time, such as
last day of payment of fees for admission tests for schools. bKash must maintain its
system in such a way that it never fails. bKash can hire mobile financial service

134
system experts and consultants to maintain the IT system with minimum failure. IT is
the core element of the service and they should put maximum effort to minimize the
failure.
 Strengthening External Security: Recently bKash agents are victims of theft, and
robbery. Hence, bKash is losing cash on unexpected incidents. bKash should
negotiate with Insurance Companies to limit the loss. A portion of agents’
commission should contribute the premiums of insurance since; agents are also
partially responsible for such circumstances.
 Educating Rural Customers on Bkash through Mobile Retailers: Studies found
that rural customers are willing to use bKash service but lack of knowledge and
education has been hindering their ways. bKash should provide some incentive to
mobile phone retailers in rural areas who will educate people and encourage them to
use bKash service, upon purchase of new mobile phones from their stores.

135
References
Ali, M. A. (2013, December 04). bKash eyes to be the largest m-banking service provider co
in the world. (F. E. Bangladesh, Interviewer)
(2014). Bangladesh Payment And Settlement Systems. Dhaka: Bangladesh Bank.
From early days of PayPal Mobile and bKash to what’s next in Mobile Financial Services?
(2014, April 14). Retrieved 5 2014, July, from Mobile Payment Blog:
http://mobilepayments.wordpress.com/2014/04/14/from-early-days-of-paypal-mobile-and-
bkash-to-whats-next-in-mobile-financial-services/
Guidelines on Agent Banking for the Banks. Dhaka: Bangladesh Bank.
HOSSAIN, F. (2014, Spril 29). Mobile banking: A silent financial revolution. Retrieved July
10, 2014, from the independent:
http://www.theindependentbd.com/index.php?option=com_content&view=article&id=21335
1:mobile-banking-a-silent-financial-revolution&catid=186:supplement&Itemid=222
(2013). IFC Mobile Money Scoping. Country Report: Bangladesh. International Finance
Corporation.
Islam, D. M., & Mamun, &. M. (2011). Financial Inclusion: The Role of Bangladesh Bank.
Dhaka: Bangladesh Bank.
Kabir, M. R. (2013). Factors Influencing the Usage of Mobile Banking: Incident from a
Developing Country. World Review of Business Research , 96-114.
MDI Case Study - bKash. (n.d.). Retrieved June 30, 2014, from GSMA Mobile Development
Intelligence: https://mobiledevelopmentintelligence.com/insight/MDI_Case_Study_-_bKash
Mitha, A., & Neu-Anspach, &. (2013). Case Study – bKash: Building the largest payment
service provider in Bangladesh. European Fund for Souteast Europe.
Mobile Development Intelligence - bKash. GSMA Mobile and Development Intelligence.
(2012). Mobile Financial Services in Bangladesh: An Overview of Market Development.
Dhaka: Bangladesh Bank.

136
The Growth of Mobile Financial Services in Bangladesh. (2013, September 10). Retrieved
June 25, 2014, from CGAP: http://www.cgap.org/blog/growth-mobile-financial-services-
bangladesh
Zaman, F., & Chowdhury, &. P. (2012). Technology Driven Banking in Bangladesh: Present
Status, Future Prospects and Challenges. BUP JOURNAL , 56-78.

137
Appendix
Corrected Parts
Segments Page Number
Vision 19
Why we have chosen this company 19
PESTEL Analysis 30
Porter Analysis 36
How bKash is creating values for its
customers by linking value propositions
60
Existing Business Model 71
Linkage between Corporate Level Strategy
and Vision
73
Linking the resource , core competencies,
capabilities with Functional level strategy for
value creation
99
Strategic Analysis (4P) 122

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