Scope of agent banking

Bangladesh Bank (BB) has defined agent banking as limited-scale banking and financial services of a bank to the under-served population through agents under a valid agency agreement. This is replacing a teller or cashier in mainstream banking. Agent banking is like a dealership or distribution business where all maintenance cost is incurred by the agent, whereas branch banking involves huge expenditure. Government aim is to take banking services to the poorest segments of society as well as to existing banking customers, especially located at geographically distant locations. Deposit collection, remittance inflow, small loan disbursement and recovery, various social safety programme of the government, utility bill collection etc are primary functions of agent banking.
BB introduced agent banking system a few years ago. Some private banks have already opened agent banking outlets across the country. BB also introduced mobile banking services a few years ago. But the transactions in mobile banking services are taking place at a limited scale. Agent banking is much better than mobile banking services but presently most unbanked people are confused about agent banking. Some consider 'agent banking' to be equivalent to some non-governmental organisations (NGOs) working at grassroots level. BB needs to popularise agent banking and encourage the unbanked people of the country to seek banking services through these.
Md. Zillur Rahaman
Islami Bank Bangladesh Ltd.
Lalmohan Branch, Bhola.
zrbbbp@gmail.com