According to data from Bangladesh Bank (BB), loan disbursements through agent banking increased 48.60 percent year over year (Y-o-Y) to reach Taka 21,089.81 crore at the end of September 2024, driven by increased rural residents’ access to financing.
Loan disbursements totaled Taka 14,192.65 crore in September of previous year.
As of September 30, 2024, 16,011 agents worked for 31 banks that provided agent banking services through 21,367 locations. Agent banking was used to open 23,489,109 accounts, of which 11,704,846 (49.83 percent) were opened by female consumers and 20,173,995 (85.89 percent) were opened by people in rural regions.
By the end of September 2024, there were Taka 39,529.37 crore in deposits in the agency banking accounts and Taka 1,65,659.23 crore in total inward remittances distributed through agents.
The main factor driving the rise in the volume of these loans, according to bankers, is that many individuals who were previously shut out of rural banking services can now easily access them thanks to the steady growth of agent banking.
A senior central bank official told BSS that agent banking is essential to offering sufficient financial services, particularly for small business owners, rural women, and remitter beneficiaries.
“Bangladesh Bank is continuously encouraging banks to facilitate CMSME, women entrepreneurship loan, and some refinance schemes for marginal people through agent banking,” he added, citing the loan deposit ratio and the percentage of lending to women or entrepreneurs.
He stated that agent banking has the ability to close the market gap caused by branch banking’s inadequate outreach because it is generally having a major beneficial influence on financial inclusion.
According to Abdul Quaium Chowdhury, Deputy Managing Director of Premier Bank PLC, the growing popularity of agent banking, particularly in rural areas, suggests that there is a great chance to provide formal banking services to the unbanked in rural areas.
He claimed that the expansion of the banks’ new offerings is the reason for the increase in the number of clients in the banking system.
Furthermore, he noted, banks’ attempts to offer services at the local level through agent banking are the reason why it is thriving.
He predicted that agent banking will grow in popularity in the future.
Furthermore, he claimed that a growing number of loans are being made as a result of numerous banks beginning to offer minor loans through agent banking.
In order to offer a secure alternative method of delivering financial services, Bangladesh Bank launched agent banking in Bangladesh in 2013. The underserved population, who typically reside in isolated areas that are challenging for the official banking networks to access, were the service’s target clients.
Consumers can access a range of banking services through agent banking locations, including as deposits, loans, local and international remittances, payment services (such taxes and utility bills), and government social safety-net benefits.
Thus, this approach is becoming more and more well-liked as an affordable and practical way to reach the general public who would not have otherwise been able to access traditional banking services.
The Prudential Guidelines for Agent Banking Operation in Bangladesh, published by Bangladesh Bank on September 18, 2017, govern how banks conduct their agent banking operations. These guidelines cover a number of topics, such as the agent approval procedure, acceptable activities, and the roles and responsibilities of both banks and agents.
In order to support the safe and efficient growth of agent banking in the nation, it also emphasizes the standards for consumer protection, business continuity, and anti-money laundering and countering funding of terrorism (AML/CFT).
*
Email *
Website
