Written by The Banking Post
Agent banking — once the fastest-growing financial inclusion tool in Bangladesh — has hit a slowdown, as regulatory compliance measures begin to weigh on expansion.
According to official data, by the end of June 2025, commercial banks mobilized Tk 1.239 trillion in deposits through agent-banking outlets across the country, while handling Tk 1.838 trillion in remittances. Disbursements to grassroots clients stood at Tk 290.08 billion, injecting liquidity into rural economies.
Despite these large volumes, the network itself has begun to contract. The number of agents declined 4% year-on-year and 3% from the previous quarter, with 618 agents exiting annually and 465 leaving between March and June. Outlets followed the same trend, falling by 916 on an annual basis and 466 in the last quarter, pushing the total to a multi-quarter low of 20,557 outlets served by 15,373 agents.
Policy Shift Triggering Contraction
Industry insiders attribute the downturn to a new Bangladesh Bank directive requiring that at least 50% of newly appointed agent-banking representatives be women. The rule, announced by Governor Dr. Ahsan H. Mansur in March and formalized in May, aims to enhance women’s participation in financial services.
While well-intentioned, bankers say the policy has slowed expansion due to a shortage of skilled female entrepreneurs in rural areas.
“This is a technology-driven business, and most rural women have yet to acquire the necessary skills to operate efficiently,” said a senior executive of a private commercial bank. Another banker noted that while some male entrepreneurs attempt to register outlets in their wives’ names, the highly technical nature of operations often makes this unsustainable.
Additional Setbacks
The contraction was also compounded by Agrani Bank PLC’s suspension of agent-banking activities on June 21, 2025, which contributed to a 1% drop in the total number of agent-banking accounts during the last quarter, according to the central bank’s report.
Financial Inclusion at Risk
Agent banking, introduced in 2013, was designed to bring financial services to underserved and remote populations. Through these outlets, customers gain access to deposits, loans, remittance services, utility bill payments, taxes, and even government social safety-net benefits.
Analysts caution that a sustained slowdown could undermine progress in financial inclusion. “A prolonged contraction risks rolling back gains made in integrating rural populations into the formal economy,” one industry observer warned.
Still, some bankers see potential in rural youth as a new wave of operators. “There is a large pool of young people in villages who can be tapped to sustain growth in this sector,” said a senior executive.
