Mobile Financial Services in Bangladesh: A Survey of Current Services, Regulations, and Usage in Select USAID Projects

This paper seeks to provide a better understanding of the progress of the mobile financial services (MFS) market in Bangladesh with respect to regulations, available products and their characteristics, agent network size and geographical coverage, and the competitive landscape. It aims to provide USAID and other development organizations with updated market information so that they can better identify appropriate opportunities for transitioning toward digital payments. The paper is a consolidation of findings derived from desk research and face-to-face interviews with key MFS providers, telecom operators, technology platform providers, regulators, and USAID project staff and beneficiaries. Some of the key findings include:

• Despite having a very clear MFS market leader, competition is growing quickly with at least ten banks now offering services and third-party agent networks helping them to close the agent gap;
• More than 80% of MFS users agreed that the services are safe, easy, and convenient;
• Around 71% of MFS users live within one kilometer of an agent, compared to just 41% of those who live that close to a bank branch;
• Majority of respondents were interested in using MFS for bill payments (77%), savings (76%), airtime top-ups (70%), education fee payments (60%), and merchant payments (55%).