Agent banking breaks social barriers, brings women into financial system

Such financial inclusion is playing a pivotal role in providing adequate financial services, especially for rural women, small business entrepreneurs, beneficiaries of remitters, writes JUBAIR HASAN about virtues of banking hybridization

Villagers used to depend on usurers and thereafter on NGOs for small moneys, from time immemorial. Gonna are the days of those moneylenders--a banking derivation called agent banking usurps the usurers by changing fast the macroeconomic landscape in the rural areas with increasing participation of female clients in the formal credit system, in particular. A greater dimension of the banking innovation is it is, basically, emerging as an effective icebreaking financial intervention in terms of removing gender disparity in rural Bangladesh where engaging women in the money market was the most critical task even one and a half decades ago.

But things have changed rapidly by virtue of the intervention by agent banking largely covering unbanked people as such financial-inclusion instrument continues to narrow the gap between shares of accounts of male and female users with formal credit inflow, deposit netting and injection of inward remittance in a remarkable increase in the once-neglected backwoods.

With the rise in the number of female account-holders, the purchasing or spending power of the women, particularly in the rural territories, continues rising, making a significant contribution to women empowerment in the once-neglected localities.

In fact, the social structure in rural Bangladesh was not favourable for participation of the womenfolk in the formal credit system but the concept of agent banking has helped to break the social barriers, integrating this community with the banking system in recent years.

Female customers have continued to grow, almost catching up with the number of their male counterpart in account opening, which indicates that financial inclusion through agent banking is contributing to women empowerment through engagement in financial activities. Moreover, the majority of the accounts are in the rural areas. This implies huge expansion of agent banking in the rural areas. It is believed that agent-operated banking services play a significant role in changing socioeconomic condition of rural women through ensuring their access to formal credits.

According to Bangladesh Bank's latest statistics, until September 2025, the share of female-owned accounts opened through agent banking increased by 6.09 per cent during this quarter, and their share almost touched the ratio of their counterparts. This scenario signifies the increased participation of women in the formal financial system through this hybridisation of banking.

The data show the total number of accounts opened through agent banking at 25,1392,93. Of them, 49.40 per cent or 12,418,185 accounts of the total accounts held by female clients while the male customers account for 51.60 per cent (12,721,104 accounts) of the total accounts and others hold the remainder.

In terms of area-wise distribution of accounts, an overwhelming 85.06 per cent or 21,384,489 of the accounts concentrated in the rural areas while the remaining 14.94 per cent (3,754,804) were maintained from urban places.

In addition, participation of female in agent-banking activities is increasing day by day. At the end of September 2025, accounts in female-owned outlets had 1,943,969 accounts where 1,622,219 were from rural areas. Again, the numbers of male and female accounts in female-owned outlets are 900,985 and 1,039,997 respectively.

The number of female customers is greater than male ones in these outlets, which might indicate that female-owned outlets have a strategic advantage in case of opening account of female customers. Female-owned outlets own about 7.73 per cent of the total accounts opened through agent banking.

An encouraging part of the life-upscaling episode is such remarkable growth continues to impact positively other key indicators with a reduction in the gap in employment ratio between the male and the female in the rural areas.

According to the data collated in the Labour Force Survey 2022 by Bangladesh Bureau of Statistics (BBS), some 52.88 million people in rural regions are employed. Of them, 32 million are male while the rest 20.88 million female.

If we compare the figure with urban places, the difference will be surprising as 13.61 million males and 3.98 million females are engaged in employment in urban places.

Another study by the BBS, titled Women and Men in Bangladesh, clearly mentions that the rate of women-headed households in the rural areas is 15.40 per cent while it is 14.50 per cent in urban regions, as of 2020.

The central bank introduced the concept of agent banking in Bangladesh in 2013 with a view to providing a safe alternative delivery channel of banking services to the under-served population, who generally live in geographically remote locations that are beyond the reach of the formal banking networks. It is not only ensuring access of rural women to formal credit but also creating multiple job opportunities there. People in the rural areas are now getting various types of services, like transactions, payments, remittance, mobile recharge, paying utility-services bills, insurance facilities and so on.

The rising trend in agent banking, especially in the rural area, indicates that there is a remarkable potential to bring the rural unbanked people under the umbrella of formal banking services. Such financial inclusion is playing a pivotal role in providing adequate financial services, especially for rural women, small business entrepreneurs and beneficiaries of remitters. Considering the fact of loan -deposit ratio and the portion of lending to women/entrepreneurs, the central bank ought to encourage banks further to facilitate CMSME, women- entrepreneurship loan and some refinance schemes for marginal people through agent banking.

Overall, agent banking is having a significant positive impact on financial inclusion and, therefore, has the potential to fill up the market gap created by the insufficient outreach of branch banking.

jubairfe1980@gmail.com