Govt e-transfer to individuals nearly triples
A new Bangladesh Bank platform has helped the government settle almost 100 per cent of its payments made to individuals electronically, giving a boost to the country’s financial inclusion efforts. The digital transfer of funds to individuals includes salaries paid to public sector employees, cash support to the poor and marginalised, and stipends to students. The payment through the platform — Government eTransaction Processing Hub (GeTPH) — escalated 159 per cent year-on-year to Tk 92,139 crore last year, according to data from the central bank. The system settles transactions made through the Bangladesh Electronic Fund Transfer Network (BEFTN), enabling beneficiaries to receive funds within a day. BEFTN facilitates the transfer of payments through banks electronically, making it a faster and more efficient means of inter-bank clearing over the paper-based system.
Every beneficiary now has to open accounts with either banks or mobile financial service (MFS) providers. The list of the accounts is preserved with the central bank’s platform. It has also cut the time needed to make the payments. Previously, the manual system took three to six months to settle the monthly payments in favour of the beneficiaries. The central bank started to transfer salaries to government employees in 2015 on a limited scale through the BEFTN, replacing the manual system that took three to five days.
Both the government and banks earlier had to deploy many employees to process transactions. The number has gone down significantly thanks to the digital system. “The digitalization of the government payment has had a great impact on the financial inclusion,” said Atiur Rahman, a former governor of the central bank.
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As a part of Prime Bank’s long-term strategy, PrimeAgrim is a step towards ensuring financial inclusion for the unbanked population.
Sumaiya Akhter is an RMG worker. She has been working with Ananta Companies Ltd. for two years. Sumaiya supports a family of three. She earns enough to support herself, her younger brother and her grandmother who reside in the village. However, every now and then emergency needs appear and Sumaiya finds it difficult to manage all her expenses.Sumaiya recently got to learn about PrimeAgrim from her work. PrimeAgrim is an AI-based instant digital nano loan platform that allows her to take instant loans. So when she was faced with the challenge of accumulating funds to pay for her younger brother’s school tuition fees, uniform and stationery expenses, she turned to PrimeAgrim for help. Sumaiya applied for a nano loan on PrimeAgrim app and got the desired amount to her Prime Bank account in an instant. With the help of PrimeAgrim she was able to pay for her younger brother’s educational expenses. Sumaiya can now easily pay off the loan upon getting the salary and keep track of her interest expenses.
PrimeAgrim is already attracting global attention. For this innovative initiative, Prime Bank has received the Bronze under Analytics & Artificial Intelligence (AI) category at the prestigious Efma-Accenture Banking Innovation Awards-2021. PrimeAgrim started piloting on 8 November, 2021 in the RMG sector with Ananta Companies Ltd. Since pilot, PrimeAgrim has disbursed more than 1,000 loans to garment workers. Prime Bank plans to expand the services to workers of other sectors and ensure financial inclusion of mass people.