Bangladesh Policy Research Institute (PRI) on Sunday organized a training program for journalists to engage journalists and media representatives in technical and policy discussions on issues related to Digital Financial System (DFS) and financial inclusion in Bangladesh. Ta.
The training program titled “New Dimensions of Digital Financial Services in Bangladesh” was organized as part of the “DFS Policy Initiatives in Bangladesh” project.
In his welcome speech, PRI Chairman Dr. Zaidi Sattar highlighted the growing use of artificial intelligence (AI) and generative AI in journalism and digital financial services.
In his speech, Dr. Sattar also emphasized the importance of ensuring the accessibility and affordability of digital financial services for all income levels to foster inclusive development.
Mr. Ahsan H. Mansour, Executive Director of PRI, explained the difference between digital banking and digital banks in a session on “Digital Banking: Opportunities and Challenges”. He shared the evolution of his services from digital banking, which started in the 1990s, to a digital-only bank in 2009.
The main difference between the two is that digital banking is part of a brick-and-mortar physical bank and provides financial services online in addition to in-person services, whereas digital banks/digital-only banks are completely virtual. He said that this means that. .
Dr. Ahsan Mansoor also discussed the current global market size of digital banks and the future increase in demand due to their accessibility.
He also elaborated on the opportunities and challenges faced by digital banks, especially in the Bangladeshi context.
Dr. Bazrul H. Khondkar, Director of PRI, presented the key findings and policy implications of the study, “Assessing the economic and social impact of financial inclusion in Bangladesh: An exploratory study using the Financial and Social Accounting Matrix (FSAM) approach.” announced the implications of
This study examines the impact of financial inclusion on key macroeconomic indicators such as economic growth, poverty, employment, savings, and investment.
The study showed that Bangladesh’s economy in 2021 is estimated at $399 billion in current prices and $320 billion in constant prices. The GDP growth rate was 6.9%, reflecting the recovery from the COVID-19 pandemic. The service sector accounts for over 52% of GDP, of which manufacturing accounts for 36% and agriculture accounts for 12.1%.
Two financial inclusion simulations were considered. His 50% increase in capital inflows to rural and urban households and half of borrowing from informal sources will be through digital nanocredit schemes.
The study found significant impacts on Bangladesh’s economy under two simulations. In SIM 1, the nominal GDP could increase by Tk 111,900 billion while the real GDP could increase by Tk 90,500 billion compared to the BAU scenario.
In SIM 2, increased financial inflows could increase nominal GDP by Tk 182,000 billion. In both scenarios, the GDP growth rate exceeds 10%, and the impact on development and national policy planning is significant.
Simulation results show that increased financial flows have a positive effect on agriculture, manufacturing, private services, and public services.
However, manufacturing and private services have a larger impact. Agricultural activities are considered inclusive and pro-poor, leading to increased food security. In both scenarios, investment and the money supply increase significantly.
PRI Research Director Dr. MA Razak, in a session on ‘Macroeconomic and Trade Issues of Bangladesh’, highlighted Bangladesh’s exports which are highly concentrated in apparel products.
He said the most exported product in the RMG sector is T-shirts, with about 8 billion T-shirts produced every year.
Dr. Razak pointed out that while the mass production of T-shirts is a strength of the economy, it shows that export concentration is weakening the economy.
He emphasized the importance of export diversification to boost growth and resilience.