Monday, August 13, 2012
Myanmar's tourist industry could receive a further boost with a
domestic bank in talks to allow Visa card holders to withdraw money from
participating automatic teller machines by the end of the year, a
banker said last week.
U Than Lwin, deputy chairman of Kanbawza Bank, one of the nation’s largest private banks, said the company was in talks with Visa over how to implement the system, adding that he expected the service could be available within six months.
“It will be for the benefit of foreign tourists,” U Than Lwin said, adding that Kanbawza would likely boost its network of ATMs in Yangon and other cities.
“This could be done within six months or in time for the Southeast Asia Games,” he said.
The SEA Games will be held in Myanmar in late 2013.
Allowing Visa to operate in Myanmar would be another step forward for Myanmar’s banking sector and would have a positive flow-on effect for other sectors, experts said.
“This is a significant event for Myanmar’s financial sector, with positive spin-offs for the economy more broadly, as well as specific industries such as tourism that depend upon efficient payment services,” said Dr Sean Turnell, an associate professor of economics at Australia’s Macquarie University.
“In essence, what is finally happening is a movement away from a purely cash economy in Myanmar, with all the efficiencies this will bring. Likewise, the movement away from cash will be a step in the greater ‘formalisation’ of the economy,” Dr Turnell said.
U Than Lwin said he was waiting for the Central Bank of Myanmar to set up the Myanmar Payment Union (MPU) that would allow banks to electronically transfer funds to each other, including for ATM transactions. He said Visa might open a representative office in Yangon in coming months.
“Once this is fully functioning we can team up with Visa and individual banks,” U Than Lwin said.
He added that Kanbawza Bank had also held talks with rival Mastercard to offer similar services.
Jared Bissinger, a PhD candidate at Australia’s Macquarie University who is studying Myanmar’s economy, said: “In most places in the world ATMs can be accessed using Visa or Mastercard and I don’t see why Myanmar would be any exception.”
“Connecting Myanmar to the international financial system gives people another way to access their own financial resources besides the current cash system, which can facilitate more and safer purchases that include a formal transaction record,” he said.
However, he said the implementation of Visa services will not be without challenges, listing the formation of an official payment union, ensuring technology and IT needs are met and expanding the country’s ATM network as being among the main barriers to overcome.
“Myanmar’s ATM network is small and not geographically spread yet, so only a portion of the population would have access to these financial services straight away. Myanmar’s banks also need to build their own technological infrastructure, so that they can use modern payments systems,” Mr Bissinger said.
Source: Myanmar Times
U Than Lwin, deputy chairman of Kanbawza Bank, one of the nation’s largest private banks, said the company was in talks with Visa over how to implement the system, adding that he expected the service could be available within six months.
“It will be for the benefit of foreign tourists,” U Than Lwin said, adding that Kanbawza would likely boost its network of ATMs in Yangon and other cities.
“This could be done within six months or in time for the Southeast Asia Games,” he said.
The SEA Games will be held in Myanmar in late 2013.
Allowing Visa to operate in Myanmar would be another step forward for Myanmar’s banking sector and would have a positive flow-on effect for other sectors, experts said.
“This is a significant event for Myanmar’s financial sector, with positive spin-offs for the economy more broadly, as well as specific industries such as tourism that depend upon efficient payment services,” said Dr Sean Turnell, an associate professor of economics at Australia’s Macquarie University.
“In essence, what is finally happening is a movement away from a purely cash economy in Myanmar, with all the efficiencies this will bring. Likewise, the movement away from cash will be a step in the greater ‘formalisation’ of the economy,” Dr Turnell said.
U Than Lwin said he was waiting for the Central Bank of Myanmar to set up the Myanmar Payment Union (MPU) that would allow banks to electronically transfer funds to each other, including for ATM transactions. He said Visa might open a representative office in Yangon in coming months.
“Once this is fully functioning we can team up with Visa and individual banks,” U Than Lwin said.
He added that Kanbawza Bank had also held talks with rival Mastercard to offer similar services.
Jared Bissinger, a PhD candidate at Australia’s Macquarie University who is studying Myanmar’s economy, said: “In most places in the world ATMs can be accessed using Visa or Mastercard and I don’t see why Myanmar would be any exception.”
“Connecting Myanmar to the international financial system gives people another way to access their own financial resources besides the current cash system, which can facilitate more and safer purchases that include a formal transaction record,” he said.
However, he said the implementation of Visa services will not be without challenges, listing the formation of an official payment union, ensuring technology and IT needs are met and expanding the country’s ATM network as being among the main barriers to overcome.
“Myanmar’s ATM network is small and not geographically spread yet, so only a portion of the population would have access to these financial services straight away. Myanmar’s banks also need to build their own technological infrastructure, so that they can use modern payments systems,” Mr Bissinger said.
Source: Myanmar Times
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