Bangladesh: Digitalisation in Development

Charting the digital services and payment revolution

Bangladesh’s readymade garment (RMG) industry employs an estimated 4.22 million people, including 2.5 million women, and contributes to nearly 9.7% of the country’s GDP and 84% of total export earnings (BGMEA, 2023). However, only 67% of the RMG workers have access to bank accounts, 12% save formally or informally, and 38% use some form of credit, mostly from informal, risky sources. 

To address this, the Sarathi project enabled a network of private and public stakeholders, including those directly involved in the project, such as Mobile Financial Service (MFS), FinTechs, startups, training providers, regulatory bodies and major trade associations to facilitate access to digital financial solutions for at least 265,000 RMG workers and community members. The Sarathi II project (2021-2024) has reached 700,018 RMG workers and their community members in the districts of Dhaka, Narayanganj, Gazipur, and Chattogram districts (out of a target of 500,000).  

Moreover, 414,700 individuals from the target group have gained access to various financial products, and of which 125,735 have used these products. To date, 33,000 RMG workers and their community members have made digital transactions. Approximately, 1,900 have received digital nano-loans [which follow AI-based alternative credit scoring methods to assess a loan applicant’s credit worthiness], 18% of 87,900 low-income workers have digitally accessed micro-savings products, and 17,220 RMG community members have been introduced to micro-insurance and have received additional round-the-clock telemedicine services.  

The Sarathi project is co-financed by the MetLife Foundation and the Happel Foundation. 

On the other hand, Satkhira, located in the southern coastal region of Bangladesh, faces a different kind of challenge. Satkhira is frequently hit by disasters such as cyclones and floods, exacerbating water salinity in the area. As a result, Satkhira is one of the most water vulnerable regions in the country in terms of sustainable groundwater management and saltwater intrusion in the country.  

In 2023, the H2O project, developed and tested two community-based water entrepreneurship models in Satkhira. The school-based social welfare model is an enterprise equipped with a sanitary napkin vending machine at Baikari Union High School and a community-based water enterprise. Beyond providing safe drinking water, the project enhances menstrual health and hygiene among female students through dedicated hygiene corners and sanitary napkin provision. By integrating water entrepreneurship into educational settings, H2O not only supports student health but also educates future generations about sustainable water practices and community stewardship. 

A smart card was introduced to purchase and recharge for accessing safe drinking water. In the school-based enterprise the same smart card serves a dual role, providing access to water and sanitary napkin dispensing. These models include the addition of a digital payment mechanism through water ATMs. The water dispensers are powered by solar energy with the capacities of 8 kW and 3.4 kW. In 2023, 412 cards were activated, including for marginalised communities and households. This digital initiative resulted in 105,588 liters of water being dispensed through the water ATMs in one year. H2O's digital innovations go beyond addressing water scarcity, fostering community empowerment through efficient and sustainable water management.  

The H2O project is co-financed by Lokales Wasser 37 AG / Max Ditting AG. 

Both projects are part of the Swisscontact Development Programme, which is co-financed by the Swiss Agency for Development and Cooperation (SDC), Federal Department of Foreign Affairs FDFA.