In a country like Bangladesh, where there is high social and economic disparity; where banking is reflective of an urban and a prosperous society, the government has taken a remarkable initiative in introducing ‘No-Frills Accounts’. This is done to bring disadvantaged people under the traditional banking method.
No-frills accounts can be opened with an initial deposit of Tk 10, Tk 50 and Tk 100 by the underprivileged people. As per report published on this daily, on Saturday the number of No-frills accounts grew by 8.48 percent to over 2.2 crore in the July-September period of the current fiscal year, beginning on June 1. The cumulative deposits in different components of no-frills accounts have stood at Tk 2,180.79 crore, according to Bangladesh Bank (BB).
Covid 19 situation has revealed the need of No-frills
accounts for bringing marginal and disadvantaged
people under the umbrella of formal financial services
So, just having an account does not make an individual financially included, but having transactions in-or-around the No-frill account truly empowers the individual. This benefits the bank as well. Therefore, government should promote this common message through mass-awareness programmes and campaigns.
Even amidst the coronavirus pandemic, No-frills accounts are on the rise over the June 2020 quarter. These accounts are playing a significant role in providing formal financial services to the marginal people. In addition to help receive government safety net allowances, these accounts are also being increasingly used for savings and loans. This indicates that No-frills accounts are gradually serving the complete purpose of financial inclusion for the marginal people.
However, the scope of utilising the No-frills accounts in Bangladesh is largely unmatched as majority of the low-income people are still out of reach of formal financial services.