Business Report :
Although mobile financial services and agent banking work as vital instruments in terms of financial inclusion, the financial literate population of Bangladesh has not increased. Reasons for this slow growth include the country’s slow internet access and lack of smartphone usage, experts said at a discussion on Thursday.
Bangladesh’s financial inclusion efforts remain heavily focused on money transfer (mobile money), without a comparable digital infrastructure and interoperable financial system, they also said.
This has resulted in slower progress in achieving national-level financial inclusion goals.
They made these remarks during a stakeholder consultation titled “Revitalizing Financial Inclusion in Bangladesh” organized by the Policy Research Institute (PRI) in collaboration with the Bill and Melinda Gates Foundation.
Bangladesh Bank Governor Ahsan H Mansur was the chief guest at the event at the Westin Dhaka hotel.
At the event, Dr Ahsan H Mansur, Governor, Bangladesh Bank said: “The MFS sector in Bangladesh has made remarkable progress, but there is only one major player in the market, bKash, while others have not fully established themselves due to trust and other issues.”
“For greater financial inclusion, we have to figure out how to utilize a smartphone as an essential commodity rather than a luxury item, as well as reduce internet costs. Our financial literacy is 28 per cent, we have to think about initiatives about how to increase this.”
Earlier In his opening remarks Dr Bazlul Haque khandakar, research director, PRI said:
“Although there is notable progress in financial inclusion in Bangladesh, especially through mobile financial service (MFS), huge gaps still remain.”
Snigdha Ali, Bangladesh country lead, Bill & Melinda Gates Foundation and Mohammad Abdur Razzaque, director at PRI, delivered the keynote presentation.
Snigdha said: “We believe if we can add everyone in financial inclusion that will enhance the economy. Our special objective is to increase poor people’s capacity to weather financial shocks and capture income generating opportunities and also increase women’s digital financial inclusion and economic empowerment.
“To do this our approach is to support regulators and policymakers in their pursuit of adopting regulations that enable widespread access and participation. Also support to reduce costs and increase research.”
“Our goal is to by 2030, to ensure 80 per cent of adults worldwide actively use digital accounts. Bangladesh’s growth in the last 53 years is good but there is still a lot to go.”
Razzaque, in his presentation said: “Bangladesh has had some initial success but achieving further potential of financial inclusion. The interim government expected to introduce comprehensive reforms for improved functioning of the country.”
“As we see 53 per cent of the population aged above 15 in Bangladesh owned a financial account as of 2021 when in 2017 this ratio was 50 per cent. According to 2021 data, we are behind countries like Nepal, India and Sri Lanka only ahead of Pakistan.”
The event focused on the current state of financial inclusion and the challenges facing the country, including regulatory gaps, inadequate digital infrastructure, and disparities in access for women and rural communities.
Challenges that have hindered the expansion of financial inclusion in Bangladesh include regulatory gaps, usability issues with digital platforms, persistent gender and rural disparities, and limited innovation and product diversification.
A key issue is the lack of consistent regulatory oversight for financial service providers.
For instance, Nagad, one of the largest MFS platforms, operated without full regulation by the Bangladesh Bank for an extended period, leading to concerns about security, consumer protection, accountability and a level-playing field for the service providers.
Recently, its licence was suspended, reflecting the need for a more unified and transparent regulatory framework across all financial service providers.
Digital platforms like Binimoy, which aim to streamline financial transactions, have faced significant usability challenges.
Complex interfaces and integration issues with existing financial systems have hindered widespread adoption.
Financial inclusion remains highly uneven across different demographic groups.
Women, particularly in rural areas, face substantial barriers in accessing financial products.
While mobile financial services have expanded, there is a need for innovation in financial products and services to meet the diverse needs of underserved populations.
Expanding the range of financial products-such as micro-insurance, digital savings accounts, SME-targeted loans, and youth-specific services-will be essential for improving financial inclusion in both rural and urban areas. Only 42 per cent of Bangladeshi women have access to financial services compared to 65 per cent of men.
This is why experts at the consultation recommended strengthening the regulatory framework to ensure all financial service providers operate under a unified, transparent system, enhancing digital infrastructure and addressing usability issues to expand the reach of platforms like Binimoy, promoting gender-inclusive financial services by developing products that cater specifically to women, particularly in rural areas, and encouraging innovation in financial products and services, including youth-targeted offerings, to meet the evolving needs of underserved populations.
