Uncertainty looms over SureCash
Uncertainty looms over financially strained mobile financial platform SureCash after it terminated 200 employees last month amid coronavirus outbreak.
Education Ministry had previously issued warnings over SureCash for irregularities in the disbursement of scholarships. According to sources, Rupali Bank has been considering canceling its contract with SureCash since last year. Rupali Bank DMD informed that they are concerned about the operational performance and financial stability of SureCash. As a financial institution, we need to have a reliable partner.
In 2018, SureCash applied for a payment service provider (PSP) license to Bangladesh Bank, but failed to acquire one. In April, Bangladesh Bank issued a license to Nagad, to operate as a full-fledged mobile financial services (MFS) providers like bKash and Rocket. Between 4th and 19th April, 19.2 lakh new accounts were opened on bKash, Rocket and Nagad, following a move by the government to make salary payment to readymade garments (RMG) workers through mobile banking. SureCash could not able to capture market share at a time when digital payments have increased.
The company took tough measures like terminating employees due to poor business performance, financial mismanagement, uncertainty regarding its contract with Rupali Bank, and inability to get the license. Some of the terminated employees said that the company was in this state due to financial mismanagement.
It has been alleged that just a few months before the job cuts, SureCash relocated its office in an expensive location, and spent heavily on office decoration. Shamima Ahsan, the former Head of Human Resources at SureCash said that the company will do another round of cuts in June, and may shut down operations by the end of the year if the conditions do not get better.
It is to be noted that SureCash started commercial operations in 2015. It is an open payment network in partnership with four local banks, including one of the largest state-owned banks and more than 1,000 payment partners.
The mobile financial platform is providing technology support to state-owned Rupali Bank for operating mobile banking services to provide stipend for primary education. More than one crore mobile financial services (MFS) accounts of Rupali Bank are being managed by SureCash.
Bangladesh Commercial Bank, Jamuna Bank and First Security Islami Bank are also operating MFS accounts jointly with SureCash. Recently, National Commerce and Credit (NCC) Bank ended its partnership with SureCash.