The Asian Development Bank (ADB) will provide US$250 million as a policy-based loan to further improve the social protection system in Bangladesh, thereby supporting the vulnerable population against socioeconomic challenges.
The assistance aims to accelerate reforms in increasing the coverage and efficiency of social protection, improving the financial inclusion of disadvantaged people, and strengthening the response to diversified protection needs.
To this effect, the ADB and the government of Bangladesh signed an agreement on Tuesday, said an ADB press release.
Economic Relations Division (ERD) Secretary Fatima Yasmin and ADB Country Director Edimon Ginting virtually signed the agreement on behalf of their respective sides.
According to the ADB, the loan is the second sub-programme of the Strengthening Social Resilience Program (SSRP) approved in 2021, which helped implement institutional and policy reforms that strengthened the inclusiveness and responsiveness of social protection in Bangladesh.
"ADB remains committed to help Bangladesh accelerate the socioeconomic recovery and assist the government to promote an integrated social protection program," the press release said, quoting the ADB Country Director.
"The integrated social protection program will improve social safety net management; deepen financial inclusion; address needs based on demographic, geographical, age, gender, and other diversities; and widen the coverage and efficiency of social protection," added Mr Ginting.
The reforms supported under the programme aims to help improve efficiency by digitalisation and integration of systems as well as harmonisation of the government's social protection programmes, as per the ADB.
Greater financial inclusion of the disadvantaged will be broadened by improving the usability of mobile financial services through the quick response (QR) code payment services, particularly in rural areas, it added.
The programme also supports a contributory protection scheme by focusing on an employment injury scheme. This contributory protection scheme will offer protection to a wider population and help augment government financing for social protection.
The reforms will help Bangladesh bring at least 80 per cent of social protection programmes with cash-based benefits under a standardised and integrated management system with connection to the G2P platform by June 2023, according to the ADB.
"At least 60 per cent of cash-based social protection benefits will be delivered to disadvantaged women, and social protection program fragmentation will be reduced in three ministries."
The number of active mobile financial services accounts will be increased annually by 5.0 per cent, it mentioned, adding at least 50 mobile clinics would start operating in 10 city corporations.
Besides, at least one social insurance scheme (contribution-based protection scheme) will be initiated on a pilot basis by 2023, it revealed.
As of 2021, ADB's cumulative assistance to Bangladesh since 1973 amounted to about $48 billion through loans, grants, and co financing, it said, mentioning that the ADB's active portfolio in the country stood at around $11 billion with 50 projects as of April 2022.
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