The only surprising thing about the failure of payment service provider Red Dot was the apparent suddenness with which the company departed.

For months – if not years – it had seemed that the company was on its last legs. Fewer terminals were active and agents had reported that it was becoming increasingly difficult to get their deposits back. They were the warning signs of a company in a death spiral.

Why did this happen? Despite investing tens of millions of dollars just a few years ago, Red Dot had become increasingly irrelevant. Its primary offering – the ability to pay bills and buy phone credit through an agent terminal – had become less compelling as newer companies and technologies appeared on the scene, offering to do pretty much the same thing, only easier, faster and cheaper. There were fewer and fewer reasons to use a Red Dot terminal.

This is normal in business, particularly in the technology space. Some ventures succeed, many fail. Speaking to Frontier back in 2015, when Red Dot had already invested upwards of US$25 million in its terminal network, founder Mr John Nagle admitted as much. “It takes a long time for our business to transition into a profitable model because you need scale,” he said.

Unfortunately for Nagle, Red Dot never managed to build the necessary scale of transactions before the money ran out.

The bad news is that agents who had paid deposits for terminals, or deposited money with Red Dot, are unlikely to get their money back. Neither a criminal nor a civil suit will change that.

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Red Dot’s crash has also spooked many consumers who are unfamiliar with financial technologies and the intricacies of Myanmar’s regulatory framework. The sector has already struggled to overcome a lack of trust from consumers and this will be a further setback.

The good news is that Red Dot was not a mobile money provider offering an e-wallet into which customers deposit money. This has limited the damage, both to consumers and to the development of the fintech sector in Myanmar. Yes, thousands of agents have lost money – typically a few hundred dollars each. But if Red Dot had been operating an e-wallet, those losses would have been multiplied by a factor of hundreds, even thousands.

In theory, e-wallet users should be protected. Myanmar has sophisticated, well-drafted guidelines. The Mobile Banking Directive of 2013 enables mobile money providers to partner with a licensed private bank, and customers’ funds are held in an account at that bank (one example is TrueMoney, which partners with AGD Bank).

The Mobile Financial Services Regulation of 2016 enables companies from outside of the banking sector to provide mobile money services. It’s often referred to as an operator-led model, because licensees are typically the major mobile operators. Telenor’s Wave Money and Ooredoo’s M-Pitesan are among the licensees, while MPT and Mytel are said to be planning e-wallets of their own.

Even though the operator-led model lets non-bank financial institutions offer e-wallets, licensed providers still need to keep customer deposits in a trust at a registered private bank. This is significant. Under both models, if the mobile money provider goes bust, customers would still be able to get their money.

This is why Frontier campaigned in 2017 for the Central Bank to address the status of OK Dollar, which had launched an e-wallet the previous year but had no licence to do so. As it was outside the licensing framework, there were zero protections for customers. As one person observed at the time, it was essentially a mobile-based hundi service – hundi referring to the informal, unregulated money transfer networks that have operated throughout Asia for centuries.

OK Dollar has since been licensed, bringing some degree of oversight to its activities. But there is still a large ecosystem of unlicensed fintech providers, as well as licensed operators who appear to be happy to flout the rules. They are doing so with impunity, because the Central Bank has so far taken a mostly hands-off approach.

Red Dot should be a wake-up call for the Central Bank. The fintech sector has got off relatively lightly, but it might not be so lucky next time.   

This editorial first appeared in the February 14 edition of Frontier.

It’s a difficult time to be a journalist in Myanmar and students at one of the country’s leading journalism institutes are aware of the challenges ahead as they seek to build careers in the media.


THE MEDIA in Myanmar underwent dramatic changes after the transition to democracy began in 2010, said U Kyaw Min Swe, as he sat as his desk editing news reports. Within two years, the suffocating restrictions that had existed through nearly 50 years of dictatorship were gone.

“In the past, we needed to submit everything [to the junta’s Press Scrutiny and Registration Division], including advertisements,” he said, referring to the onerous pre-publication censorship that was abolished in August 2012. “Now, everyone can write anything.”

However, some recent developments have not pleased Kyaw Min Swe. The executive director of the Myanmar Journalism Institute and editor-in-chief of The Voice Weekly journal said media freedom had gone backwards since the National League for Democracy government took office in 2016 after its landslide election victory the previous year.

“Just look at the statistics; more reporters have been arrested and sentenced since 2015, including the two Reuters journalists,” he said, referring to Ko Wa Lone and Ko Kyaw Soe Oo. They were arrested under the Official Secrets Act in 2017 while investigating the massacre of 10 Rohingya men and boys in Rakhine State and were sentenced in September 2018 to seven years’ jail.

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In its 2018 world press freedom index, Reporters Without Borders ranked Myanmar 137th out of 180 countries and territories. Reporters Without Borders said about 20 journalists were prosecuted in Myanmar last year, including the two Reuters journalists.

Kyaw Min Swe expressed concern that the jailing of journalists would deter people from seeking a career in the media. The new generation was worried about working in the media because of “the sentencing and jailing” of journalists, he said, adding that some parents would not want their children to choose a career in the field because it could be “dangerous”.

Students at MJI said they were concerned about declining media freedom and heightened risks for journalists but still determined to forge a career in the sector.

“It is very dangerous [to be a journalist] in Myanmar,” said Ko Kyaw Swar Tun, 21, a full-time multimedia diploma student at MJI. He intends to continue his studies despite knowing that journalists are being arrested and even sometimes killed.

Asked why he had chosen to pursue a career in journalism despite the perceived risks, he compared it to driving a car. “Every driver is not facing accidents every day,” he said.

Kyaw Swar Tun said he believed journalism would provide a satisfying career as a member of the Fourth Estate. Journalists play a vital role in imparting information and helping to close the gap between the government and its people, he said.

Another MJI full-time student, Ko Aung Ko Ko Oo, 33, said he was concerned about negative attitudes towards journalists and worried about the possibility of being arrested and jailed.

Media laws impose limitations on media freedom in Myanmar, he said. “I will need to be careful about what I write.”

Aung Ko Ko Oo is a graduate of the University of Nursing who began his working life as a nurse but later discovered an interest in journalism. He had enrolled at MJI in 2018 despite opposition from his family to the career change.

“My father didn’t like the idea of me becoming a journalist,” he said.

Student Ko Aung Khant, 22, said his mother was against him becoming a journalist but had not stopped him from applying to study at MJI.

“She said to me, ‘You can do as you like,’ but she has never encouraged me to pursue this profession,” he said.

Aung Khant, Kyaw Swar Tun and Aung Ko Ko Oo are among 24 full-time diploma students at MJI, which has a faculty of 18. The 11-month programme covers basic journalism, news writing, radio reporting, video reporting, photo journalism, online journalism, media law and ethics, feature writing, governance and gender issues.

MJI also runs short courses ranging from five days to a month on a range of topics, which have in the past included data journalism, election reporting and mobile journalism. It recently concluded trainings on climate change and water pollution.

Located in Bahan Township, MJI was established in 2014 by 39 local media organisations and media houses. It is one of just a handful of institutions in Myanmar offering formal journalism training, including the non-government Yangon Journalism School and its Mandalay branch, the Mandalay Journalism School; the state-run National Management Degree College, which runs a four-year Bachelor of Arts (Journalism) course; and the Myanmar Media Development Centre, which offers classes in practical and technical skills, such as television and radio broadcasting and editing, and graphic design.

Kyaw Min Swe said that although MJI relied mainly on funding support from various organisations to operate, it also had a self-sustaining business plan under which training is provided to new and working journalists in return for tuition and course fees.

He said the financial pressure on media houses in Myanmar was also affecting the earnings of journalists. Working journalists who wanted to expand their skills might not be able to afford the tuition fees, he said.

Kyaw Min Swe said MJI needed to adapt to the situation and seek new sources of income.

“MJI will need a commercial change, to look for alternative audiences, like public relations, communications skills, things that are related to journalism,” he said.

MJI full-time student Ko Myint Thu Win, 30, said journalists in Myanmar would face many challenges in future over what they can write because of government attitudes about controlling the media. However, he was confident of resisting control over his work, saying that his hand, pen and thoughts “belong to me, not the government”.

Despite challenges and the prospect of a difficult working environment, MJI students said they remained determined to become journalists.

“I will continue to pursue a career in journalism,” said Kyaw Swar Tun, who wants to be a political journalist. “I might get arrested and sent to jail, but I am prepared.”


MYITKYINA — Three Kachin community activists sentenced to six months’ imprisonment in December for defaming the Tatmadaw were honoured in absentia with the inaugural Kachin Human Rights Defender Award at a ceremony on Wednesday in Myitkyina.

The activists, Nang Pu, Lum Zawng and Zau Jat, were sentenced on December 7 to six months in prison and fined K500,000 each under section 500 of the Penal Code for their role in leading peaceful demonstrations in Myitkyina last April. Human rights groups have decried the ruling as an attack on freedom of speech and assembly.

Several thousand people demonstrated in April and early May on behalf of IDPs who were trapped in Tanai Township during a period of escalated fighting between the Kachin Independence Army and the Tatmadaw. The protesters called for the safe passage of the IDPs and for humanitarian access to conflict-affected areas.

About 100,000 displaced people are living in camps in Kachin State as a result of fighting between the KIA and the Tatmadaw, according to the UN Office for the Coordination of Humanitarian Affairs, after a 17-year ceasefire broke down in 2011.

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The Kachin Human Rights Defender Award was provided by the World Kachin Congress and the Kachin Consultative Group, and presented at the Kachin National Manau Park. The award is named after the mushe, a Kachin legendary spirit that stood up for truth and justice.

According to Sut Seng Htoi, a member of the Kachin Youth Movement Steering Committee, Nang Pu, Lum Zawng and Zau Jat were selected for the award to acknowledge that their imprisonment was unjust, to recognise their humanitarian work, and to empower other youth activists.

Another steering committee member, Seng Hkum, said, “This award doesn’t just recognise the sacrifice made by the three recipients in their fight for justice, and their courage; it is also meant to inspire other young people”.

On Thursday, Neng Pu will also receive the Schuman Award, which is issued to three people annually by the European Union in Myanmar, for her engagement in defence of democracy, the rule of law and human rights.


The Kachin Human Rights Defender Award is supported by two groups that seek to raise awareness about Kachin issues. The World Kachin Congress is a network of individuals from the Kachin diaspora, and the Kachin National Consultative Assembly is a network of prominent Kachin leaders, whose purpose is to facilitate political processes and develop a platform for dialogue.

Organisers said that one aim of the award is to highlight the numerous human rights challenges in Kachin State, where humanitarian access to IDPs is often restricted, and where human rights defenders risk arrest, most often under section 17(1) of the Unlawful Associations Act, and section 500 of the Penal Code for defamation.

Francis Zau Tu, program director of the Myitkyina-based Humanity Institute think tank, said that those engaged in human rights work in Kachin State are closely watched by the military.

“Freedom of expression is very limited, especially in rural areas,” he said. “We have to think carefully about what we say and post online. We cannot criticise the government. The current culture of impunity is a hindrance to promoting and protecting human rights.”

As well as reaching a local audience, the award sought to raise awareness in the international community about the flawed judicial system in Myanmar and the steps still needed toward achieving a full federal democracy in which all people have freedom of expression and their basic rights are met.

“It is important for the international community to know what is happening in Kachin State,” Francis Zau Tu said. “If we shut our mouths, we cannot achieve our freedom and our rights.”

If the intention behind imprisoning the three activists was to deter others in Kachin State, for many it has had the opposite effect, Seng Hkum said.

“The Tatmadaw might have tried to frighten people by imprisoning these three activists, but they were mistaken. Now we, the people, are more inspired. The Tatmadaw tried to bring us down, but we will keep going. They cannot shut us down.”

Ko Paw Lu, leader of the Ram Hkye Youth Rescue Network, said he stood in solidarity with the imprisoned activists. “We as youth are not afraid. The activists who were arrested were working for the truth; we know they didn’t make a mistake. We will keep moving forward.”

During Wednesday’s ceremony, family members of each of the activists were invited to receive the awards on their behalf. Jaw San Nu, the wife of Zau Jat, told Frontier, “My husband stands for all human rights defenders in Kachin State. I am proud of him and what he stands for.”

Asked what message he wanted to share with the public in relation to the award, Nang Pu’s father said, “Today, I wish for safety for all people in Myanmar and aid to all people in need.”