DFCC introduces first-ever mobile wallet to local banking space

From left: DFCC Bank Vice President Services Denver Lewis, DFCC Bank Deputy Chief Executive Officer Lakshman Silva, DFCC Bank Chief Executive Officer Arjun Fernando, Synapsis Chief Executive Officer/Managing Director Dinesh Fernandopulle and DFCC Bank Chief Technology and Services Officer Achintha Hewanayake

The financial landscape this week witnessed the launch of the first-ever mobile payment app with DFCC Bank unveiling its revolutionary Vardhana Virtual Wallet, an effort that aims at pushing financial inclusion. The state-of-the-art mobile app enables users to simplify transaction methods and stay in control of their finances.

The system is secured by SSL and purchases via the application are possible only by generating a transaction PIN. Automated logout functions are enabled after a period of inactivity. DFCC shared that over 100 merchants have already registered and the number is expected to grow in the coming month. The primary benefit to merchants is that the service reduces operating costs as the transaction costs are lower compared to other payment instruments

Personal wallet holders will be able to manage and organise finances real time with their respective bank accounts being linked to the application, allowing them to reap the benefits of financial freedom and flexibility. Highlighting the objective of the app, DFCC Bank CEO Arjun Fernando said,

“We want to get the unbanked and under banked into the banking system. The development of the product was on that basis. The thinking here is small value transaction.” Those interested in the Vardhana Virtual Wallet would require to open a personal account at DFCC and submitting a duly completed Vardhana Wallet mandate. Merchants are to follow a similar procedure. Merchants and personal wallet holders will have the freedom to choose how they transact, either via a mobile device or a PC and have the Vardhana Virtual Wallet system integrated into their transaction processing system.

Banking sector urgedto stay relevant

As the government treads towards a digital economy, it is a matter of time the country’s banking and financial services sector reaching the levels of the telecommunication industry in offering innovative electronic and mobile payment systems to the consumers, according to a banking veteran.

“The national payment policy, together with the government’s drive towards having a digitised economy, will cut across the silos operating. It is essential that we, the banking industry, see the overall perspective in this regard and look at how we can play,” said DFCC CEO Arjun Fernando to Mirror Business. With the advent of mobile wallets in the likes of Google Wallet and Apple Pay, the relevance and their role in this new order of payment has been challenged.

However, the digital revolution has toughened the playing field for the banks constantly requiring them to reinvent themselves to stay relevant and remain as an important cog in this evolving payment ecosystem. The move will help drive consolidation and would allow greater electronic and mobile payment offering to customers, Fernando added. Unlike the regional peers, such as India, Pakistan and Bangladesh, in Sri Lanka the electronic and mobile payment instruments are led by the telecommunication sector as opposed to the banking and finance space. “The industry lost the opportunity. The banks lost the opportunity. They were sleeping back then.

They thought payments were a given thing and didn’t work towards it. So the telcos took the lead in that space,” said Fernando. Although the telco industry took the leap to make available mobile payment platforms, it was followed by a number of issues that revolved around high cost and security. Having realised the risks the Central Bank is now active in encouraging the banking industry to explore such options. “Although late, now the banks have understood the potential of this avenue, especially for financial inclusion, and are working towards it. We need all in the ecosystem to push this forward. We need to look at having interbank linking. There what we should aim for,” expressed Fernando. He added that the next step for the industry to explore should be agency banking, where merchants should be able to pay out and receive cash.