Mohammad Mudassar Aqil, CEO, Telenor Microfinance Bank/Easypaisa, is an accomplished executive with over 21 years of banking experience in the US and Pakistan with demonstrable success in areas of organizational restructuring, digital finance, FinTech partnerships, and business growth.
He has a steadfast record in consistently delivering exceptional results by developing high-performance teams, focusing on value drivers, and executing strategies. Mudassar also has extensive expertise in leading banking operations, HR, strategy, and marketing.
Before joining Telenor Microfinance Bank, Mudassar was the President and CEO of FINCA Microfinance Bank. Mudassar also serves as a director on the board of Pakistan Microfinance Network.
Q1. In January, did you expect 2020 to be as unpredictable as it has turned out to be?
Reports of the spread of Coronavirus across China had started emerging at the end of December last year. By January, cases were being reported from other parts of the world as well. With no available vaccines, social distancing was the only viable preventive measure against it. However, I don't think anyone could have predicted how vast the impact of this outbreak was going to be. The situation has been utterly unprecedented and took the world by surprise. And, unfortunately it continues to fluctuate every day affecting more and more people across the world.
We have business continuity plans to deal with all kinds of situations but an apparent lack of test cases in the past has brought about a challenge for us too. Still, as of now we are more focused on finding solutions to this complex situation in front of us and treating this as an opportunity to reposition the business for the changes that are afoot all over the world.
Q2. Coronavirus in Pakistan. It's a global pandemic, so the situation in Pakistan is also turbulent. What are your thoughts on how we're approaching the crisis and would you have done anything differently?
The Coronavirus pandemic is indeed a global crisis that has made its way to our shores. Fortunately, we have been one of the few countries that have been proactive in their approach towards this threat. Ever since reports reached us of our students stranded in China, screenings were initiated at all airports. We were able to contain the situation for a significant amount of time and even after the first batch of cases was reported, the Government has done its best to fulfill all its responsibilities towards society.
On the economic front, the State Bank of Pakistan has been active since day one. The interest rate has been slashed multiple times, lowering it substantially. Provisions have been made for all banks to restructure and reschedule loans for individuals and organizations that are facing difficulty in making payments. Loans are also being offered at minimal rates to facilitate hospitals and companies in continuing operations amid strict guidelines and SOPs. The response from all stakeholders has been amazing and with a strong approach like this, I am certain that we will be able to emerge from this crisis soon and hopefully stronger than ever.
Q3. Some are lucky that their jobs can be productively done from home but there are many in the workforce, such as healthcare providers, LEAs, government departments and all essential service providers, who are on the frontline risking themselves, so that we don't have to. Do you have a message for them?
We are eternally grateful to these heroes of society for putting their duty before the risk to their health and wellbeing, playing the role of front line heroes. The society owes a great deal to these brave men and women who are striving day in and day out to create a safe environment for us. At a time like this I believe that it is our responsibility to show our respect and gratitude towards these individuals by standing with them and supporting what they do in any way that we can.
Most of all, it is our duty to ensure that we follow the guidelines that keep us safe from being infected. Giving heed to their advice is the highest form of admiration that we can show towards them.
Q4. One such essential service is the financial services industry. What are the challenges that the industry faces, at the current time, due to the pandemic?
The financial service industry forms the backbone for any economy and at present, this sector in Pakistan is doing just that. The challenges that the industry faces are diverse and volatile. The biggest issue is uncertainty. With strict lockdowns in effect and business activity limited, no cure or vaccine on the horizon in the near future, economic activity and consumer confidence both have nosedived. The global economy is in recession which is appearing to be the worst the world has seen in the last 100 years.
From a risk management perspective, banks will look to strengthen their balance sheets and liquidity and evaluate their business models for relevance in the new post COVID-19 world. One clear implication is that the people are going to adopt digital services at an exponential rate and every financial institution needs to have a digital strategy.
Q5. WHO guidelines state that the virus can spread by the use of currencies. What role are digital financial services playing in enabling Pakistan to go cashless?
Digital financial services can play a key role in mitigating the risks of the virus spreading through surfaces like paper and plastic. The State Bank of Pakistan has instructed all financial institutions to quarantine all notes before releasing them back into circulation but we are witnessing a healthy shift towards the use of digital services. As COVID-19 has halted movement and people are indoors, digital financial services provide almost every service that a user would need to conduct their daily financial activities remotely without the need of being physically present at a bank or public place. Speaking of our mobile banking platform Easypaisa, its mobile app has been further upgraded to provide more customized solutions to all its users to conduct cashless transactions from the safety of their homes.
With the help of our Easypaisa mobile application, the users can enjoy a variety of different services which include but are not limited to: maintaining accounts and wallet, transferring of money and conducting payments, recharging their mobile balances, paying utility bills, availing various discounts and topping up their wallets which are also integrated with various e-commerce platforms. We have also introduced the Corona Health Services insurance plan which can be subscribed directly through the application. There are constant updates and notifications available through the digital platform, users can also make donations, conduct payments at retailers through scanning QR codes and make purchases for all essential items. Additionally, transaction charges have been waived for both customers using interbank fund transfers and QR retailers dealing in provision of essential commodities. Similar initiatives are also being launched by other platforms to form a robust digital financial ecosystem. Since the lockdown, the number of daily transactions from the Easypaisa application have grown by 17%, while a 35% increase in new activations has also been witnessed. Old customers using the service again have gone up by 25% as well. There has also been an increase of 184% in bank transfers and around 15% growth in airtime and bundle subscriptions in overall transactions.
The aim is to provide incentives to the population that uses cash for 80% of all its transactions in light of the risks associated with transfer of the virus through currencies.
Q6. The Covid-19 caught everyone by surprise and forced many industries to improvise and adapt to the ongoing situation. Were there any policies or plans that were brought forward to help Pakistan and its economy at such a time?
The Coronavirus outbreak put the economy in a tough spot due to the nature of the impact it has had on the economy in particular. There was a need for all stakeholders in the financial circle to come together and the State Bank of Pakistan took the lead from day one. There have been regular revisions of the monetary policy to accommodate all the sectors in the industry that have been impacted during these turbulent times. Banks being the main lenders have received a reduction in their Capital Conservation Buffer allowing more funds to become available for release to customers looking for credit. At the same time, initiatives are being introduced for small and medium businesses, hospital financing and payroll schemes which are aimed at easing the burden on numerous organizations.
As a responsible corporate entity, it is also our responsibility to come forward and do everything we can for our country. In addition to supporting all initiatives of the State Bank of Pakistan, our team is tirelessly working to come up with more innovative and convenient options for not only individuals but entire organizations and the Government as well. We are assisting the Government in safe distribution of funds to those in need. Recently, Telenor Pakistan and Telenor Microfinance Bank collectively pledged PKR 1.6 billion, in cash and kind, towards COVID-19 relief efforts.
Moreover, we are also taking all measures to spread awareness regarding the disease while simultaneously making people aware of the benefits, safety and convenience which comes by the adoption of digital payments and technologies.
Q7. The world in recent years has shifted towards Digital Financial Services (DFS) and Pakistan has been gradually entering into the fold. Will the current situation serve as an opportunity for Pakistan and its economy to extensively shift towards DFS?
As the saying goes, never let a crisis go to waste, it is encouraging to see that with the lockdowns having persisted for over a month now, we have already observed exceptional growth in the use of digital financial services across the country. Interbank transfers, airtime purchases and a host of other transactions including cashless payments at physical or online stores have shown tremendous growth. Earlier studies had shown that a lack of awareness and knowledge about using digital financial services were the two biggest factors hindering people from adopting them.
Now though, the present situation has addressed both these concerns simultaneously. As more people continue to accept that the use of these services is imperative, they are learning about the user-friendliness of the application interfaces and also about the service in general. We believe that the introduction to simpler, swifter and hassle-free transactions will undoubtedly encourage users to opt for a digital lifestyle even after the situation has returned to normalcy.
This is a great opportunity for Pakistan to make decisive progress towards financial inclusion. For the first time every Pakistani consumer and business owner has understood the perils of cash economy and benefits of digital payments and bank accounts. We need to cease this moment and ensure that every adult Pakistani opens a digital wallet. Similarly, every business big or small needs to start accepting digital payments and go cashless. We are proud to have state of the art solutions available for both individual and business users to help them migrate to digital finance through our Easypaisa platform.
Q8. A lot of organizations introduced SOPs for work in the lockdown. What challenges did your company face?
The challenges we faced was for us to ensure provision of essential services while keeping our employees and customers safe. We believe our employees and customers to be the greatest assets that we have and in such unfortunate circumstances, we are taking all measures in our capacity to ensure that they are provided with a safe environment to operate in.
Fulfilling the responsibility of being a financial institution providing essential services, we cannot entirely shutter branches and operations and have to maintain limited on-ground presence. We are strictly adhering by stringent standards to provide the highest quality of hygiene and health safety to our employees who are at the front line and are tirelessly performing their duties. In addition, our offices are being disinfected on a regular basis and all personnel are instructed to maintain a safe distance between them. Similarly, sanitizers, safety masks and gloves are also being provided to everyone present in the offices and branches and it goes without saying that awareness regarding the risks is also being imparted through all mediums on a regular basis.
Moving towards the customers who have to visit our branches in order to perform their necessary transactions, we are creating a cocoon of safety. In addition to the distancing practices and hand sanitizers being provided to them, all currency notes at the bank are going through a mandatory quarantine and disinfection process. Most importantly, in order to promote a safer environment, we are encouraging customers to shift towards the widespread use of digital payment services like our Easypaisa platform and practice social distancing.
Q9. On a personal note, what will be your advice or recommendation to those commencing or restarting their professional careers in the time of Coronavirus and post pandemic?
The holy month of Ramadan has begun and all around the world, there have been scattered reports of countries opening back up under strict guidelines since the worst of the pandemic has passed. China has successfully curbed its infection showing that it is possible to recover from the situation. In Pakistan, things are different and as essential businesses start to open, we have to take into account the fact that there is still a huge responsibility on all of us. COVID-19 is contagious and an infected person can remain asymptomatic but infect numerous others at the same time.
Health and safety have to always come first. We owe it to our families and loved ones to remain safe. So, people who are going for and restarting their business activities or professional careers must abide by all safety and prevention guidelines set out by the WHO and the Government. The use of sanitizers and masks should be made a part of the daily routine. Workstations must be disinfected before and after use, social distancing must be maintained at all times and all other requirements put in place but health experts must be respected for not just own sake but also the benefit of society as a whole.
Once again, I would like to reiterate that people should learn from what is happening around and learn from the experience of other countries. It is imperative that we go digital in our processes as adoption of such technologies will benefit us greatly, even after the pandemic.