NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Monday, December 1, 2014

Bangladesh is going digital. Not in smart watches, sensor-based clothing or electronic health records, but in money. Mobile money. Money, that according toBRAC and the Gates Foundation could improve the economic and health outcomes of the country, especially of women and children. With a healthy appreciation of the complexities in scaling digitally, faith in innovation at the grassroots level and years of planning, these organizations just might make mobile money the future of finance.

Throughout the country, like all countries in the world, there are citizens that are “unbanked,” meaning that they do not possess a bank account and cannot share funds person-to-person, even within families, without cash. For these people, a significant portion of Bangladesh’s population (estimated 70%), access to formal financial services for starting businesses, paying for children’s education and health services, and paying salaries for community health workers could translate to millions of improved and saved lives.

For Bangladesh’s large rural population, transportation and infrastructure challenges, combined with a weak banking infrastructure, financial inclusion remains a tall order. However, increases in cell phone utilization in these areas mean that mobile money – instead of cash – could make payment to individuals, schools, health care providers and businesses seamless and easily accessible.