Mobile financial services have revolutionized the rural landscape of Bangladesh.

 

Just 10 to 12 years ago, a garment worker in Dhaka had to send money to his family through intermediaries at a specific cost. Many intermediaries worked to carry the funds of different types of job holders and workers to their homes. However, senders were still determining whether their money would safely reach their beloved family with the exact amount. They were left undone because they were out of the banking system or there needed to be more presence of banks in their area.

 

By 2023, a garment worker will have an MFS Account linked to her cellphone number. She will no longer need intermediaries to send money to her family members. All she needs to do is cash in (refill) her account from the nearest agent point (retail) and dial a number to send money to her family member's MFS Account. Her family members can easily withdraw money (cash-out) from their nearest agent point. This process is much more straightforward than traditional banking, as you don't need to find a bank around you but rather an MFS agent (retail) who is always nearby. A proper distribution network is pivotal in serving untapped, unbanked customers.

 

Mobile Financial Services (MFS) have brought about a revolution in financial inclusion by empowering rural communities. Through mobile technology, MFS providers have successfully extended financial services to remote areas of Bangladesh, reaching out to previously unbanked individuals. As a result, people living in rural areas can now access a wide range of financial services, such as sending and receiving money, purchasing airtime, paying bills, and availing other financial services, all through their mobile phones. MFS has transformed the rural landscape of Bangladesh in numerous ways.

 

MFS has significantly increased financial inclusion for unbanked individuals, particularly in rural areas. According to a study conducted by BIDS, MFS has reduced the number of unbanked adults from 45% to 20% in 2017.

 

Moreover, MFS has created new income opportunities and livelihoods for rural people, especially women and youth. By establishing a network of agents, MFS provides cash-in and cash-out services, producing over 1.2 million jobs in Bangladesh, with 25% of those jobs held by women. Additionally, MFS has facilitated access to financial products for rural entrepreneurs and farmers.

 

Furthermore, MFS enables fast, cheap, and secure remittance transfers, reducing costs by 80% compared to informal channels and increasing the frequency and amount of transfers. It also improves the security and convenience of receiving money.

 

MFS has revolutionized the financial services industry by bringing it to the fingertips of millions of rural people, thereby improving their economic and social well-being. MFS operators offer digital value-added services for deposits and withdrawals. Thanks to a well-established distribution network, retail stores that initially sold FMCG or telecom products now provide MFS services at your doorstep.