Agent banking has witnessed significant year-on-year growth in number of accounts, loan disbursements, deposits and remittance inflow.
According to Bangladesh Bank data, the number of accounts in agent banking topped 96,43,000 in 2020. At the end of December 2021, the number of accounts stood at 1,40,47,000, which is a 45.67% increase.
According to sector insiders, over the past few years, agent banking has managed to include a substantial number of people at the rural level who were excluded from banking services. The inclusion process was accelerated by the coronavirus pandemic.
According to the central bank data, a total of 29 commercial banks are currently providing this service through 19,247 outlets operated under 13,951 agents.
The number of outlets stood at 15,908 at the end of 2020. Thus, the number of outlets increased by 3,339 in a year. Of these, 16,593 outlets are providing services in rural areas at present.
At the end of December 2021, the number of accounts in agent banking stood at 1,40,46,398 with Tk24,054 crore deposits. In 2020, the deposit amount was Tk15,687 crore. Thus, deposits have increased by Tk8,367 crore in a year which is a 52.05% year-on-year increase.
Bank Asia ranks highest among the top five banks in agent banking in terms of Share of Outlets and Share of Accounts. The bank's Managing Director Md Arfan Ali said, "Bank Asia has been working since 2014 to provide service to the people of rural areas through agent banking. We hope to expand our services in the future."
"Agent banking plays a major role in providing remittance services as people in remote areas can easily get money," he said.
"Since we have fewer outlets at the rural level, we created new models for loan disbursements. We will implement loan disbursement from the agent outlets in each district which will improve disbursement of microcredit, agriculture credit and SME credit," he said.
Meanwhile, loan disbursement through agent banking has increased by 182.43% over a year. In 2021, the disbursement of loans through agent banking stood at Tk5,346 crore, which was Tk1,893 crore in the previous year.
At the same time, remittances inflow through agent banking stood at Tk 82,343 crore last year, which was 48,806 crore in 2020. Thus, remittance inflow increased by 68.67%.
Selim R F Hussain, the managing director/CEO of Brac Bank Ltd, told The Business Standard, "The Brac Bank has disbursed the most amount of loans through its agent branches. Our goal is to increase SME loans at the rural level through agent banking."
"Now Brac Bank has disbursed about 70% loans of the entire market in two years. If our agent outlets grow in the future, the number of deposits and remittances will also increase significantly," he said.
"We started agent banking services in November 2019 but the expansion of agent outlets was impeded due to Covid-19. Even so, we have more than 700 agents across the country. Our service is different from other banks. We provide digital solutions that agents use through the app. At the same time, customers can also use this app 24 hours a day," he added.
The Bangladesh Bank has introduced agent banking in Bangladesh in 2013 intending to provide a safe alternate delivery channel of banking services to the under-served population who generally live in geographically remote locations that are beyond the reach of the formal banking networks.