Trade
4 years ago

BD witnesses massive shift to digital payments in RMG sector

Representational image: A view of RMG workers engaged in the activity. – Collected Photo
Representational image: A view of RMG workers engaged in the activity. – Collected Photo

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Bangladesh has witnessed a massive shift from cash to digital payments within the space of one month in the RMG or ready-made garment sector, according to a survey.

The survey was conducted on May 15 and 16, 2020, by researchers working for a local research institute in Bangladesh, South Asian Network on Economic Modeling (SANEM), and a US-based NGO, Microfinance Opportunities (MFO).

As of May 16, 67 per cent of workers reported they had been paid. There are some differences in the experiences of men and women workers during the May payment cycle, SANEM said in a press release on the survey report on Friday, adding that fewer women reported having being paid – 64 per cent of women against 74 per cent of men.

And 82 per cent of workers, who were paid, reported that they were paid through some sort of digital channel (bKash, Rocket, Nagad, or bank transfer). In comparison, in April, 28 per cent of garment workers were paid digitally. This represents a massive shift of payments from cash to digital within the space of one month. Both women and men reported being paid digitally at about the same rate—82 per cent and 84 per cent respectively, it said.

Women were less likely to have withdrawn the cash from their accounts immediately after they had been paid—84 per cent of women reported withdrawing their salary from their account immediately in comparison to 93 per cent of men, SANEM said.

Despite the large number of workers being paid digitally, many for the first time, the process went smoothly for most of them: 95 per cent were able to cash out their payment at an ATM or agent on their first try and 78 per cent waited in line to cash out for less than 10 minutes, the local research institute added.

In conducting this survey, the researchers surveyed 1,384 workers in the RMG sector in Bangladesh by telephone.

The workers and the researchers had previously participated in the Garment Worker Diaries study, which collected data from 1,300 workers throughout 2019 and until the end of January 2020.

Almost three-quarters of them are women. Though the sample over-represents women, it can be considered to be roughly representative of workers in the sector as a whole, the press release noted.

The workers surveyed are employed in factories spread across the five main industrial areas of Bangladesh —Chittagong, Dhaka City, Gazipur, Narayanganj, and Savar.

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