Loan disbursements through agent banking saw a significant increase of 55.95 per cent year-on-year (Y-o-Y), reaching Taka 24,028.31 crore by the end of December 2024, driven by improved access to finance for rural populations, according to data from Bangladesh Bank (BB).
In December of the previous year, loan disbursements amounted to Taka 15,407.33 crore.
As of December 2024, a total of 31 banks provided agent banking services through 21,248 outlets operated by 16,021 agents. The number of accounts opened via agent banking reached 24,078,230, with 11,982,675 accounts belonging to female customers and 20,610,405 accounts held by customers in rural areas.
The total deposits accumulated in agent banking accounts amounted to Taka 41,955.81 crore, while the cumulative sum of inward remittances disbursed through agents stood at Taka 1,73,390.72 crore.
Bankers have observed that the steady expansion of agent banking has enabled many previously unbanked individuals in rural areas to access financial services more easily, which is the primary driver behind the increased loan disbursements.
Speaking to BSS, a senior official of the central bank stated that agent banking plays a crucial role in providing financial services, particularly for rural women, small business entrepreneurs, and beneficiaries of remittances.
Considering the loan-to-deposit ratio and the proportion of lending to women and entrepreneurs, Bangladesh Bank is consistently encouraging banks to facilitate loans for Cottage, Micro, Small, and Medium Enterprises (CMSMEs), women entrepreneurs, and various refinance schemes aimed at marginalised populations through agent banking.
Overall, agent banking is making a significant contribution to financial inclusion and has the potential to address market gaps caused by the limited reach of traditional branch banking, he added.
Abdul Quaium Chowdhury, Deputy Managing Director of Premier Bank PLC, remarked that the increasing adoption of agent banking, particularly in rural areas, highlights the substantial potential for integrating unbanked individuals into the formal banking system.
He attributed the rise in the number of banking customers to the expansion of new services offered by banks. Furthermore, he noted that the growth of agent banking is largely due to banks’ efforts to extend their services to grassroots levels through agent banking channels.
Looking ahead, he predicted that agent banking would continue to gain popularity. Additionally, he pointed out that many banks have begun offering small loans through agent banking, contributing to the overall increase in loan disbursements.
Bangladesh Bank introduced agent banking in 2013 to provide a secure alternative delivery channel for banking services. The primary target of this initiative was the under-served population, particularly those residing in remote geographical locations beyond the reach of conventional banking networks.
Customers can access various banking services through agent banking outlets, including deposits, loans, local and international remittances, payment services (such as utility bills and taxes), and government social safety-net benefits.
This model is increasingly being recognised as a cost-effective and convenient means of delivering banking services to the general public, particularly those who would otherwise remain outside the reach of traditional banking institutions.
Banks operate their agent banking activities following the Prudential Guidelines for Agent Banking Operation in Bangladesh, issued by Bangladesh Bank on 18 September 2017. These guidelines cover various aspects, including the agent approval process, permissible activities, responsibilities of banks and agents, as well as compliance requirements.
Additionally, the guidelines emphasise anti-money laundering (AML) and combating the financing of terrorism (CFT) measures, along with customer protection and business continuity requirements, to ensure the safe and effective expansion of agent banking across the country.
