Community centres handed over to BDB

Management: In a move that will make banking services available in all gewogs, the operation and management of community centres (CCs) was officially handed over to the Bhutan Development Bank (BDB), yesterday.

While the bank already took over management of CCs from Bhutan Post in March, the transfer had not yet been finalised.

The government decided to transfer management of CCs to the development bank to increase the utility of the centres as financial services would be included alongside public services like G2C (government to citizen) services, among others. The government’s stand is that financial services are more in demand by rural communities and that BDB because of its already wide rural coverage is in a better position as a vendor.

Speaking at the transfer ceremony, information and communications minister, DN Dhungyel said the transfer is not occurring because Bhutan Post did a bad job but because financial services are required by rural communities and that its addition will address problems of inaccessibility to such services in the gewogs.

While BDB was already providing gewog banking services, it was doing this only once a month by dispatching a mobile unit from its nearest branch.

The government also sees the combination of public and banking services under one roof as a cost savings measure.

BDB managing director Pema Tshering said that these cost savings will translate to the government reducing its subsidy for CCs.

The CCs, which were being managed by Bhutan Post since December 2011, was subsidised at a cost of Nu 40.2 million until March, this year.

There are currently 195 established CCs in the country constructed at a cost of Nu 290.2 million.

Pema Tshering added that by having a permanent presence in all gewogs that ease of doing business and access to credit for rural communities will be significantly increased.

However, there will still be challenges in turning the CC endeavour into a completely successful story.

Department of Information Technology and Telecom (DITT) director Phuntsho Tobgay said that finding a self-sustainable business model will remain an objective. DITT is the owner of the CCs while BDB will be the operating vendor.

He explained that there had been no examples to model the concept on when the department was instructed to achieve such a task. While there are community information centres in India, there are not based on a self-sustainable model, he pointed out. “Until today, we’re not sure how we can actually make the CCs self-sustainable,” he said.

The previous vendor, Bhutan Post had pursued a model of partnering with other agencies like the Bank of Bhutan, the Royal Insurance Corporation, the Business Opportunity and Information Centre, the Motion Pictures Association, UNDP, to also provide their services through CCs for a fee. Except for the Bank of Bhutan, all agencies are expected to continue their partnership with BDB. Bhutan Post is also expected to provide postal services through the CCs.

Director Phuntsho Tobgay added that while there had been challenges in getting the CCs connected with optical fibre cables and in constructing infrastructure, the largest hurdle had been getting all involved parties to understand the importance of a sustainable business model and to convince the government to subsidise the effort.

Eventually, ownership of the CCs will also be transferred from the DITT to the Department of Local Governance (DoLG). This issue of ownership was discussed at some length during the transfer ceremony.

Phuntsho Tobgay said that when DITT had requested the DoLG for space to locate CCs within gewog administration offices, the department was informed that there was no available space, as a result, the current CC model was created. Since then, he said, the issue has been repeatedly raised as to when the CCs would be handed over to the DoLG as service delivery is a core mandate of a local government as per the Local Government Act.

He added that it was never DITT’s intention to “crowd out” the DoLG. However, he added that the DoLG needs to take a more proactive role in terms of taking ownership.

Information and communications secretary, Dasho Kinley Dorji added that it was always the understanding that DITT, as an IT department, would eventually handover ownership to the DoLG as it is the agency that is more aware of rural needs.

The DoLG director general Dorji Norbu said that there had been confusion about ownership at the start of the project and that eventually the department only played a monitoring role. He added that it may have seemed that the DoLG was involved only “halfheartedly” but that had not been the intention as the department was not aware of what its responsibilities were.

While the picture is more clear today, Dorji Norbu added that there still has to be a clear division of responsibilities worked out between the the agencies involved, specifically, BDB and the gewog centres on management.

Lyonpo Dhungyel also pointed out that discussions with the DoLG on its responsibilities would begin once “teething problem” issues with the CCs are sorted out.

The CCs were launched in 2011 with the primary objective of providing rural communities with access to fast, affordable and reliable public services using information communications technology. The overall goal was to reduce poverty, empower communities, and improve the quality of life in rural areas.

By Gyalsten K Dorji

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