Agent banking has made significant contribution to rural economy over the past few years and it’s becoming increasingly popular.

People are getting remittances from abroad and they can now pay their utility bills through this channel. Some youth are also finding new opportunities of employment as agents.

The number of accounts for agent banking has reached 17.77 lakh by the end of July this year, against 14.69 lakh under 18 banks in March 2018.

Availability of mobile phones and internet facilities in rural areas have made it easier for agent banking services. Banks in the country are now focusing on agent banking for its popularity among people, especially in remote areas. Banking experts say agent banking offers several services such as inward remittance, money transfers, different deposit schemes, and payment utility service bills.

Agent banking is becoming more reliable among rural people. Private banks are trying to make a foray into areas where no formal banking services are available. Clients are allowed to have deposits and withdraw cash through the outlets operated by agents without visiting a bank branch. Nowadays, many services are available at rural level, whereas people had to go to towns, earlier, for these purposes.

Bangladesh Bank introduced agent banking in December 2013 with the aim of including rural people who were out of the ambit of banking services. Bank Asia was the first private bank to offer the new concept of banking to people.

Agent banking offers limited banking and financial services to under-served population by engaging representatives under a valid agency agreement. It is the owner of an agent outlet which conducts banking transactions on behalf of a bank.

Information available from the central bank till June shows that Tk 2,012.77 crore have been deposited in agent banking sector. Inward remittances were Tk 3,514.22 crore at the same time.

Loan disbursement facility is a new inclusion to the agent banking service from last year. Loans worth Tk 109 crore were disbursed last year.

Premier Bank’s managing director and chief executive officer M Reazul Karim said agent banking has played a major role in inclusive banking.

“We have been trying to reach out to rural people with the inclusive banking concept. Agent banking is a good tool to serve this purpose,” he added.

According to a study of Bangladesh Institute of Bank Management (BIBM), 3 per cent of the clients of agent banking are day labourers.

“Twenty-nine per cent clients are businessmen at small level, 7 per cent are farmers, and 18 per cent are housewives,” the BIBM reported.

Agents provide services such as cash deposits, withdrawals, remittance disbursement, small value loan disbursement, and recovery of loans. The agents, however, cannot issue cheque books or bank cards.

As per the central bank rules, the maximum transaction ceiling for agent banking customers is Tk 25,000. An agent banking customer will be able to make a maximum of four transactions a day—two withdrawals and two deposits. But there is no limit in withdrawal of inward remittances. Besides, each bank has to maintain a current account with the agent and the balance on that account may not cross Tk 10 lakh.

Mohammad Shamim Murshed, SEVP and head of agent banking division, has said Premier Bank has started agent banking business since October 2017. “Till date, we’ve opened 55 agent banking outlets and we expect to open 100 outlets by November 2018. Next year, we are planning to open 200 more outlets across the country,” he said.

Bangladesh Bank Financial Inclusion Department general manager Md. Abul Bashar has said people are enjoying banking facilities through agent banking in places where no banks have their branches. “It’s almost like usual banking. Clients get detailed information of their transactions on their cell phones. The new concept of banking has become more trustworthy,” he added.

EA