In pursuance to digital financing, the Royal Monetary Authority (RMA) is conducting a feasibility study on international payment gateway and e-commerce modalities.

With financial sector seeing rapid technological advancement, there is a growing demand for an international payment gateway and e-commerce platform in the country.

“The ability to pay for products or services on a website is becoming less of a convenience feature and more of an option customers expect,” The RMA’s payment system report stated.

The initial plan is however to implement a payment gateway platform to support the inbound international payments particularly in the tourism sector and provide an avenue for domestic e-Commerce merchants to expand their global reach.

With more emphasis on cottage and small industries, the RMA also felt the need to establish an international e-Commerce platform to take local products into the international market.

However, today the central Bank’s attention is on the integration of the Bhutan Financial Switch and National Financial Switch of India to enable cross-border ATM transactions for cash withdrawal, balance enquiry and reversals and purchases using PoS terminals.

Based on the recommendation of the Reserve Bank of India (RBI), the RMA also initiated the migration and implementation of Global Interchange for Financial Transaction (GIFT) from Electronic Fund Transfer and Clearing System (EFTCS).

While the EFTCS provided users easy and efficient means to settle bulk fund transfers from one account to many accounts and vice-versa, the RBI recommended for a complete overhaul of the existing system.

The GIFT would support interbank fund transfer, allow the transfer of money from one bank to any other bank on “real time” and on a “gross” settlement basis and handle cases where multiple beneficiaries are to be credited from a single account.

While efforts to promote digital finance are on, the RMA has also proposed for aNational Payment Council of Bhutan.

The council would comprise members from both regulatory body and market players and serve as an advisory body to guide the RMA in modernising and developing country’s payment and settlement systems.

“It shall also act as a catalyst to overcome coordination problems between the market participants that may hinder the attainment of common objectives,” the report stated.

With development in banking services and move towards enabling retail payments through mobile banking, the RMA is also conducting a feasibility study on interoperability of QR code to create a common QR network, either using Bhutan Immediate Payment system or mandating banks to adopt a common framework.

To provide strategic direction in implementing the strategic priorities, the RMA would also draft a strategy document, which will serve as a road map in implementing any initiatives related to payment and settlement systems in Bhutan.

Among others the RMA has also empowered other agencies like the Bhutan Telecom as e-money issuers.

The RMA Board approved the E-Money Issuers Rules and Regulations in September 2017 to authorise and regulate electronic money to support financial inclusion through extension of financial services beyond the conventional branch-based banking.

With the launch of B-Ngul, Bhutan Telecom offers wallet services to its customers comprising of the unbanked population living in the far-flung corners of the country.

Bhutan Telecom Limited currently has 47,466 users subscribed to its B-Ngul service with a growth rate of 279 users on average a month.

A total number of 7,835 transactions amounting to Nu 7.19 million were transacted using the B-Ngul wallet system since its launch in May until December 2018.

Tshering Dorji