Ensure inclusion of the marginalised: Experts

While Bangladesh strives to transition from a “Digital Bangladesh” to a “Smart Bangladesh,” research has revealed that individuals from poorer and marginalised sections of society still face significant barriers to accessing digital financial services.

Issues such as limited access to devices, internet connectivity, and trust concerns hinder their inclusion, said the experts emphasising the need for the government to address these challenges before embarking on the Smart Bangladesh agenda.

These findings were disclosed during the “National Consultation on Digital Financial Services and Financial Inclusion at the Local Level in Bangladesh,” held in the capital city on Thursday.

The Policy Research Institute (PRI) organised the event where three researchers presented their findings. The research was conducted as part of the “Policy Initiative for DFS in Bangladesh” project, implemented by PRI with support from the Bill and Melinda Gates Foundation.

Dr Akhtaruzzaman Khan, head of the Department of Agricultural Finance and Banking at Bangladesh Agricultural University, highlighted the progress and trends of digital financial services among farmers. He identified the multiple benefits as well as the challenges faced by 400 farmers engaged in livestock, fisheries, crops, and horticulture.

According to his research, bKash emerged as the most widely used DFS provider, followed by Nagad (30 per cent) and Rocket (23 per cent).

He, however, observed that despite ten years of progress in digital bank account availability, a significant number of unbanked individuals reside in rural areas. “Due to a lack of fundamental connectivity, financial literacy, and social awareness, such services are often underutilised,” he added.

The second study presented at the event focused on “Access to Digital Financial Services for the Plain Land Indigenous Population in Northern Bangladesh” and was conducted by Asrafi Bintay Akram, a teacher of Sociology. The study highlighted that the main reasons the ethnic communities sought these services were for receiving money (83 per cent), sending money (83 per cent), and withdrawing money (70 per cent).

Dr Nazrul Islam, a professor at the Department of Business Administration of Shahjalal University of Science and Technology, studied the haor people and identified barriers to DFS usage. These included transaction complexity (25.39 per cent), unavailability of mobile phones (14.87 per cent), lack of guidance on service usage (13.42 per cent), unavailability of electricity (12.69 per cent), and absence of identification documents (10.70 per cent).

Dr Sadiq Ahmed, vice chairman of PRI, emphasised that evidence showed a substantial unfinished agenda. Issues such as limited smartphone access, low usage of internet services, digital illiteracy, trust concerns, scams, fear factors, and high costs of mobile financial services are key challenges in the current landscape.

Additionally, the very limited use of DFS for production services is largely attributed to the absence of DFS-based loan services, he said.

Dr Bazlul Haque Khondker, a director of PRI, highlighted the importance of gathering insights and perspectives directly from the communities most affected by the financial exclusion.