RANGOON — Burma’s only card payment system, the Myanmar Payment Union (MPU), plans to become a public company before the end of this year, MPU general secretary Ye Min Oo said on Tuesday.
Founded in 2011, MPU’s members include 18 local banks, three of which are state-owned. MPU set up the first ATM card payment system in Burma, which was lacking because of decades of economic mismanagement and isolation under the former military regime.
The MPU falls under the authority of the Central Bank. The organization’s comprises the managing directors of the 18 member banks, which all pay about US $20 million to join the MPU and freely contribute their time to manage the MPU.
In recent months, MPU signed cooperation agreements with China Union Pay, Japan’s JCB International, and the US’ MasterCard and Visa.
Ye Min Oo told The Irrawaddy that it had been decided to turn the MPU into a new public company with member banks becoming shareholders and a board of directors that would be staffed with managing directors of the banks.
“After we’ve become a public company, members [banks] will become shareholders,” he said, adding that the MPU would still have to decide how shares would be offered for sale to outside investors.
In 2015, Burma hopes to launch its first stock exchange center with the help of the Japan Exchange Group Inc. and about 100 public companies plan to register.
Ye Min Oo said MPU would expand its staff, while the capital requirements for joining the MPU would also be changed in the near future.
He said that the work of the MPU is set expand as it seeks to promote the acceptance and issuance of payment cards and develop a cashless electronic retail payment environment to suit the needs of Burma’s rapidly growing economy.
Since the MPU was founded, the number of MPU card users has risen to 200,000 nationwide and there are about 2,000 ATM machines in Rangoon, Mandalay and Naypyidaw.
Ye Min Oo said expanding ATM card usage was being hampered by Burma’s underdeveloped communications technology infrastructure, as phone lines and internet connections remain extremely poor compared to many countries in the region.
“Some MPU cards holders say their card is not working in some areas because there is no good telephone line connection, so we just distributed our MPU machines in areas with good communication,” he said. “We expect that after international telecom firms [Norway’s Telenor and Qatar’s Oredoo] could solve this problem, all areas will be easy to access.”
Zaw Lin Htut, deputy managing director of Kan Baw Za bank and a MPU member, said the MPU would become a public company this year, although details of the new company structure still have to be decided.
“In other countries, payment unions are becoming public companies, so we also need to change to a public company, so that the MPU card system can develop better and also because Burma’s card payment industry will become more active,” he said.