PRESENT AND FUTURE OF DIGITAL BANKING SERVICES IN BANGLADESH

Abstract

The rapid digital transformation of Bangladesh’s financial sector has positioned Mobile Financial Services (MFSs) as a cornerstone of financial inclusion and socio-economic empowerment. This study explores the evolution, barriers, and impacts of MFS adoption across households and small to medium enterprises (SMEs) in Bangladesh, employing a qualitative research design to capture the multifaceted experiences and insights of key industry professionals. The interpretivist framework guided the study, emphasizing the subjective understanding of participants actively engaged in the MFS ecosystem. Data were collected through semi-structured, in-depth interviews with five senior experts representing leading financial institutions, regulatory authorities, and fintech organizations. The selection of participants followed a purposive sampling approach, ensuring that each respondent possessed over a decade of experience in policy implementation, digital finance operations, or regulatory oversight. The research findings were derived through Braun and Clarke’s (2006) six-phase thematic analysis, which enabled the systematic identification of recurring themes such as technological accessibility, digital literacy, regulatory complexity, trust, and socio-economic empowerment. The analysis revealed that while Bangladesh has achieved substantial progress in digital financial inclusion—accounting for nearly 12% of the global mobile money accounts (The Daily Star, 2024) challenges such as high transaction fees, limited rural connectivity, and cybersecurity concerns persist. MFS platforms like bKash, Rocket, and Nagad have redefined household and business financial practices by enabling faster remittances, transparent transactions, and enhanced liquidity management. At the same time, gender disparities and digital literacy gaps continue to hinder the equitable distribution of benefits, highlighting the need for targeted financial education and regulatory reform. This study contributes to the growing body of literature on digital financial transformation in developing economies by offering grounded insights into how MFS reshapes Bangladesh’s socio-economic fabric. The findings underscore the importance of balancing innovation with inclusive policy frameworks to ensure sustainability and trust within the digital financial ecosystem. The research advocates for a multi-dimensional strategy encompassing digital literacy development, regulatory modernization, and cost optimization to maximize MFS’s potential in achieving Bangladesh’s broader developmental goals under the “Smart Bangladesh Vision 2041.”