EXECUTIVE SUMMARY .bd



Development of a Detailed Implementation Plan with M & E Framework and Resource Plan for the National Financial Inclusion Strategy of Bangladesh (NFIS-B) Prepared for:Nathan Associates London Ltd.Prepared by:INSTITUTE FOR INCLUSIVE FINANCE AND DEVELOPMENT (InM)01 December 2019EXECUTIVE SUMMARYFinancial inclusion has significant potential for improving the well-being for all, especially for the participants in unserved and under-served financial markets who belong to the poor and marginalised groups; CMSMEs; small and marginal farm households; participants in informal sector activities; youth and women belonging to poor households; indigenous people; persons with disabilities; and other disadvantaged groups. The People’s Republic of Bangladesh has developed the National Financial Inclusion Strategy of Bangladesh (NFIS-B) as an effective tool to achieve the core objective to ‘increase the level of financial inclusion of all adults to 100 per cent by 2024 to be measured by a nationally authenticated evaluation framework’.Since financial inclusion is a cross-cutting issue, successful implementation of NFIS-B is dependent on adoption of a sound financing strategy for which a balanced mapping between and among public finances, private finance and development assistance is critical. The strategy plans to have its short-term phase till 2024, while the follow up strategies (medium term phase) will be implemented within 2030 (for achieving the SDGs by 2030) and the long term phase will help the country to emerge as a high income country by 2041 while driving towards an advanced economy under the Delta Plan 2100.The NFIS-B coordination structure comprises of three committees (the National Council, the National Steering Committee and the National Advocacy Committee), supported by the NFIS-B Secretariat. These will be further augmented, if required, with thematic working groups. The NFIS-B Steering Committee (NSC) will develop implementation plans for strategic areas relating to their respective core objectives, and will closely monitor key initiatives undertaken by each of the Thematic Working Groups on a quarterly basis. NFIS-B National Secretariat will track the overall performance indicators and targets and report to the NSC on an annual basis to ensure that efforts are in line with the agreed targets. The tracking process will include: continuous monitoring the progress to achieve targets of financial inclusion; intermediate (midterm) evaluation to review the targets; and end-term evaluation (annually or more) to review the strategy.NFIS-B has set 12 goals and 65 targets. The activities for achieving the goals and targets of NFIS-B would be implemented mostly by the private sector in collaboration with the public sector, NGO-MFIs and other institutions. Therefore, the implementation of NFIS-B is a multi-stakeholder task which requires effective and timely collaboration among all concerned stakeholders, with the key stakeholders being the concerned ministries and agencies, regulatory authorities, financial institutions and NGO-MFIs, trade bodies and associations, and international organisations including the development partners. The NFIS-B year wise implementation plan provides a summary of the priority goals and targets which have been identified as drivers and enablers of financial inclusion within the framework of NFIS-B, and for each, the expected result, the respective activities needed to achieve it, the lead and support institutions, the activity timeline, the indicators of success, and the priority assigned by the stakeholders. The Monitoring and Evaluation system will measure success relative to the set targets. These targets are quantified subcomponents to contribute to the achievement of the given sets of objectives/outcomes.Though there is no universally accepted mechanism to set targets, most of the recently formulated national financial inclusion strategies and supportive documents prescribe or use some common approaches. Latest available data by the World Bank Global Financial Inclusion (Findex) and IMF Financial Access Survey (FAS) are used to identify the ‘benchmark year’ (2017) and the projection bases for the following years. The inclusion status and growth of the countries (as per Findex and FAS) with similar socioeconomic and other related conditions offer valuable lessons in determining projected figures for Bangladesh. The data and information collected from various sources are unified and transformed into a format suitable for summarising and analysing. This is accomplished through data mapping, which is an integral step in the M & E processes where National Secretariat will be the Data Destination Centre (DDC) as part of its Medium Term, and Long Term Tracking/evaluation of NFIS-B, for maintaining MIS, and for preparing M&E reports. Internal and public reports are two important approaches to communicate NFIS-B progress. Based on global best practices, for NFIS-B, there should be: (i) a frequent (e.g. quarterly) internal progress report; and (ii) an annual report. Periodic reporting may include both external and internal publications, such as an external newsletter to highlight NFIS-B successes and a separate, internal progress report to monitor actions and identify bottlenecks. Further, internal progress reports should often include action-level progress, and gaps. It is important to standardise the periodic reporting to monitor progress more effectively over time. Total additional resource requirements have been estimated through detailed discussions with all relevant stakeholders, especially those who will be involved in actual implementation of NFIS-B including regulatory authorities, concerned ministries and agencies, banks and other financial institutions, NGO-MFIs, insurance companies & associations, trade bodies & associations, post office, cooperatives and other potential organisations. While calculating additional NFIS-B resource cost, implementation cost of each activity is considered along with assuming that regular activities after implementation of each institution will be transferred to its regular budget. During the five year period of 2020-2024, the total additional requirement is estimated at BDT 573,831 million at constant 2018/19 prices. Table of Contents TOC \o "1-3" \h \z \u EXECUTIVE SUMMARY PAGEREF _Toc25847296 \h 2List of Tables PAGEREF _Toc25847297 \h 6List of Figures PAGEREF _Toc25847298 \h 6List of Acronyms PAGEREF _Toc25847299 \h 7Chapter 1 PAGEREF _Toc25847300 \h 10Introduction PAGEREF _Toc25847301 \h 101.1 Background PAGEREF _Toc25847302 \h 101.2 NFIS-B Implementation and Resource Plan PAGEREF _Toc25847303 \h 121.3 Objective of NFIS-B implementation and resource plan PAGEREF _Toc25847304 \h 141.4 Structure of the Report PAGEREF _Toc25847305 \h 15Chapter 2 PAGEREF _Toc25847306 \h 16Operationalising NFIS-B Coordination Structure PAGEREF _Toc25847307 \h 162.1 Features of NFIS-B Coordination Structure PAGEREF _Toc25847308 \h 162.2 NFIS-B National Coordination Structures PAGEREF _Toc25847309 \h 162.2.1 National Council – Structure and Responsibilities PAGEREF _Toc25847310 \h 172.2.2 NFIS-B Steering Committee PAGEREF _Toc25847311 \h 172.2.3 NFIS-B Advocacy Committee PAGEREF _Toc25847312 \h 182.2.4 Thematic Working Groups PAGEREF _Toc25847313 \h 182.3 NFIS-B National Secretariat PAGEREF _Toc25847314 \h 192.4 Mapping and Identification of Lead and Associate Institutions PAGEREF _Toc25847315 \h 202.5 Role Identification of Lead and Associate Institutions PAGEREF _Toc25847316 \h 302.6 Key Stakeholders’ Roles and Responsibility Matrix PAGEREF _Toc25847317 \h 302.6.1 Financial Service Providers and the NFIS-B PAGEREF _Toc25847318 \h 312.6.2. Development Partners and the NFIS-B PAGEREF _Toc25847319 \h 322.6.3 Role of Bangladesh Bank PAGEREF _Toc25847320 \h 322.6.4 Role of Ministry of Finance PAGEREF _Toc25847321 \h 33Chapter 3 PAGEREF _Toc25847322 \h 34Operationalising NFIS-B Action Plan PAGEREF _Toc25847323 \h 343.1 NFIS-B Outcomes and Objectives/Targets PAGEREF _Toc25847324 \h 343.2 Prioritisation and Sequencing of Activities PAGEREF _Toc25847325 \h 363.3 NFIS-B Implementation Partners PAGEREF _Toc25847326 \h 373.4 Year-wise Implementation Plan: 2020-2024 PAGEREF _Toc25847327 \h 39Chapter 4 PAGEREF _Toc25847328 \h 41Operationalising NFIS-B M&E System PAGEREF _Toc25847329 \h 414.1: Setting Targets in Line with the Anticipated Objectives/Outcomes of NFIS-B PAGEREF _Toc25847330 \h 414.2: Monitoring and Evaluation (M&E) System PAGEREF _Toc25847331 \h 494.2.1: Indicators to Measure NFIS-B Implementation PAGEREF _Toc25847332 \h 494.2.2: Mid Term and End Term Tracking and Evaluation for M & E PAGEREF _Toc25847333 \h 544.2.3: Integrated Index to Indicate Overall Status of Financial Inclusion PAGEREF _Toc25847334 \h 554.3: Data Mapping and Reporting for Operationalising M&E Framework PAGEREF _Toc25847335 \h 57Chapter 5 PAGEREF _Toc25847336 \h 58NFIS-B Progress Report PAGEREF _Toc25847337 \h 585.1 NFIS-B Review Intervals and Reports PAGEREF _Toc25847338 \h 585.2 Structure of Periodic Internal Reports PAGEREF _Toc25847339 \h 585.3 Structure of Annual Report PAGEREF _Toc25847340 \h 59Chapter 6 PAGEREF _Toc25847341 \h 61NFIS-B Implementation and Resource Plan PAGEREF _Toc25847342 \h 616.1 NFIS-B Implementation and Resource Plan PAGEREF _Toc25847343 \h 616.2 Estimated Resource Envelope for NFIS-B PAGEREF _Toc25847344 \h 616.2.1 Total Resource Requirements PAGEREF _Toc25847345 \h 62Annexures PAGEREF _Toc25847346 \h 64Annexure 1: Terms of Reference for the NFIS-B National Council (NNC) PAGEREF _Toc25847347 \h 64Annexure 2: Terms of Reference for the NFIS-B Steering Committee (NSC) PAGEREF _Toc25847348 \h 68Annexure 3: Terms of Reference for the NFIS-B Advocacy Committee (NAC) PAGEREF _Toc25847349 \h 72Annexure 4: Terms of Reference for the Thematic Working Groups PAGEREF _Toc25847350 \h 75Annexure 4.1: Financial Sector Deepening Working Group PAGEREF _Toc25847351 \h 75Annexure 4.2: Digital Financial Services Working Group PAGEREF _Toc25847352 \h 78Annexure 4.3: CMSME Working Group PAGEREF _Toc25847353 \h 81Annexure 4.4: Consumer empowerment and risk management Working Group PAGEREF _Toc25847354 \h 84Annexure 4.5: Data and Measurement Working Group PAGEREF _Toc25847355 \h 87Annexure 5: NFIS B Secretariat Charter PAGEREF _Toc25847356 \h 90Annexure 6: NFIS-B Year Wise Implementation Plan PAGEREF _Toc25847357 \h 93Annexure 7: Priority Actions of Bangladesh Bank and Ministries PAGEREF _Toc25847358 \h 140Annexure 8: Compatibility Analysis of SDG and NFIS-B Targets PAGEREF _Toc25847359 \h 153Annexure 9: Goal and target wise additional resource requirements (in million BDT at constant 2018/19 prices) PAGEREF _Toc25847360 \h 163List of TablesTable 2.1: Mapping/identification of lead and associate institutions for individual targets21Table 2.2: Roles and responsibilities of key stakeholders30Table 3.1:List of selected regulatory bodies and ministries38Table 4.1:Quantified Targets for Measuring Financial Inclusion43Table 4.2:Indicators for M & E System51Table 4.3:Semi-Annual Evaluation Format54Table 4.4:Annual Evaluation Format 54Table 4.5:Two-Yearly Evaluation Format 55Table 4.6:Integrated Weighted Average Index of Financial Inclusion 55Table 4.7:Integrated Score of the Index and Interpretations 56Table 6. 1:Additional resource requirements (in million BDT at constant prices)63Table 6. 2:Suggested potential source of resources (in million BDT at constant prices)63List of FiguresFigure 2.1:NFIS-B Coordination Structure17Figure 4.1:Dimensions of Financial Inclusion Indicators50Figure 4.2:Data Collection Mapping and Involvement of Agencies57Figure 5.1:Elements of periodic internal reports59List of AcronymsA2iAccess to Information ABB Association of Bankers ADPAnnual Development ProgrammeAFIAlliance for Financial InclusionAIFAlternative Investment FundAMLAnti-Money Laundering ATMAutomated Teller Machines BABBangladesh Association of BanksBB Bangladesh BankBBSBangladesh Bureau of StatisticsBFIUBangladesh Financial Intelligence UnitBHBFCBangladesh House Building Finance CorporationBIABangladesh Insurance AssociationBIDA Bangladesh Investment Development AuthorityBISBank for International SettlementsBMDFBangladesh Municipal Development FundBPOBangladesh Post Office BRDBBangladesh Rural Development BoardBSCICBangladesh Small and Cottage Industry CorporationBSECBangladesh Securities and Exchange CommissionBTRCBangladesh Telecommunication Regulatory CommissionCDFCredit and Development ForumCFTCombating Terrorist FinancingCIBCredit Information BureauCMSME Cottage, Micro, Small and Medium EnterpriseCSEChittagong Stock ExchangeDCCIDhaka Chamber of Commerce IndustryDDCData Destination CentreDFIDevelopment Financial InstitutionsDFSDigital Financial Services DLTDistributed ledger technology DSE Dhaka Stock Exchangee-KYCElectronic-Know Your CustomerFASFinancial Access SurveyFBCCIFederation of Bangladesh Chambers of Commerce & IndustriesFIDFinancial Institution DivisionFintech Financial Technology FSPFinancial Service ProviderGOBGovernment of BangladeshGPFIGlobal Partnership for Financial InclusionIBFTInternet Banking Fund TransferIDRA Insurance Development and Regulatory Authority of BangladeshIMFInternational Monetary FundInsurtechInsurance TechnologyKYCKnow Your CustomerM&EMonitoring and EvaluationMCCIMetropolitan Chamber of Commerce & IndustryMFIMicro Finance InstitutionMFS Mobile Financial ServicesMISManagement Information System MLJPA Ministry of Law, Justice and Parliamentary AffairsMNOMobile Network OperatorMoAgMinistry of AgricultureMoDMRMinistry of Disaster Management and ReliefMoEFCCMinistry of Environment, Forest and Climate ChangeMoEWMinistry of Expatriates' Welfare and Overseas EmploymentMoFMinistry of FinanceMoHMinistry of Health and Family WelfareMoICTInformation and Communication Technology DivisionMoLGMinistry of Local Government, Rural Development and Co-operativesMoPMinistry of PlanningMoPEMRMinistry of Power, Energy and Mineral ResourcesMoPMEMinistry of Primary and Mass EducationMoSW/MSWMinistry of Social WelfareMoWCAMinistry of Women and Children AffairsMoWRMinistry of Water ResourcesMoYSMinistry of Youth and SportsMRAMicrocredit Regulatory Authority NACNFIS-B Advocacy CommitteeNBFINon-Bank Financial InstittutionNBRNational Board of RevenueNFIS-BNational Financial Inclusion Strategy- BangladeshNGONon-Governmental OrganizationNIDWNational Identity Registration WingNNCNFIS-B National CouncilNRBNon Resident BangladeshiNSCNFIS-B Steering Committee PDBFPalli Daridro Bimochon Foundation/ Rural Poverty Alleviation FoundationPKSFPalli Karma Sahayak FoundationPOSPoint of Sales PSPPayment Service ProvidersPTDPost & Telecommunications DivisionRegtech Regulatory Technology SDGSustainable Development GoalsSMESmall and Medium EnterpriseSOCBState-Owned Commercial BankSPV Special Purpose VehicleSuptech Supervisory TechnologyToRTerms of Reference1Introduction1.1 BackgroundFor attaining development targets within a holistic framework, one of the priorities of the Government of Bangladesh (GOB) is to increase the access for all individuals and enterprises to quality financial products and services. To facilitate the process, GOB has developed the National Financial Inclusion Strategy of Bangladesh (NFIS-B) as an effective tool to achieve the core objective to ‘increase the level of financial inclusion (having at least one regulated financial service account) of all adults to 100 per cent by 2024 to be measured by nationally authenticated evaluation framework’ within 2024. This strategy plans to have its short-term phase till 2024, while the follow up strategies (medium term phase) will be implemented within 2030 (for achieving the SDGs by 2030) and the long term phase will help the country to emerge as a developed country by 2041 while driving towards an advanced economy under the Delta Plan 2100.The government’s priority is to adopt the NFIS-B stems from a number of considerations, including persistence of financial exclusion despite high priority given to potential of financial inclusion to reduce poverty and inequality, and promote financial stability, inclusive growth and shared prosperity. The NFIS-B has been developed through a broad consultative process involving, among others, a wide range of public and private sector stakeholders engaged in financial sector development and financial inclusion. In common with any strategy document, NFIS-B highlights the analysis of current status and constraints to financial inclusion along with specifying agreed measurable financial inclusion goals, how Bangladesh intends to reach these goals within the specified time frame, and how Bangladesh plans to assess the progress and achievements of the specified goals.This strategy is a stand-alone and comprehensive document which has been adopted by the government to systematically accelerate financial inclusion and raise awareness on financial inclusion challenges, build trust and collaboration among all stakeholders, adopt comprehensive and integrated approaches to promote financial inclusion, and provide a clear roadmap on how to implement and coordinate financial inclusion initiatives. Further, the expectation is that the strategy will contribute towards developing a range of financial products and services considering both supply and demand side perspectives. It also outlines measures for improving financial literacy and education, expanding poor-friendly financial products and services, and promoting consumer choice and safety as well as product/service quality. To facilitate the progress, the strategy provides the roadmap of actions--agreed and defined by relevant stakeholders--to achieve Bangladesh’s financial inclusion goals. The strategy also sketches guidelines for coordinating efforts of all stakeholders, defines responsibilities among them, and suggests allocation of resources and efforts through prioritising the targets. The overall goal is to promote a more effective and efficient process of achieving significant improvements in financial inclusion. This agreed roadmap provides a comprehensive framework for all stakeholders to focus on two important factors:422031112542Deliver the financial inclusion target of ‘no one left behind’ adopted in the Seventh Five Year Plan (2016-2020)00Deliver the financial inclusion target of ‘no one left behind’ adopted in the Seventh Five Year Plan (2016-2020)18756938686Facilitate prioritisation and coordination in the financial inclusion agenda; and ‘democratise’ digitisation, enhance efficiency and expand inclusion from financial to social services along with ensuring better governance, transparency, and improved and equitable service delivery.00Facilitate prioritisation and coordination in the financial inclusion agenda; and ‘democratise’ digitisation, enhance efficiency and expand inclusion from financial to social services along with ensuring better governance, transparency, and improved and equitable service delivery.Moreover, the following considerations have been taken into account in preparing the NFIS-B: In this context, the government has decided to develop a detailed year-wise implementation plan for NFIS-B including an M&E framework and activity-wise resource plan.163195-5314951.2 NFIS-B Implementation and Resource PlanThe implementation of NFIS-B is a multi-stakeholder task which requires effective and timely collaboration among all concerned stakeholders. The key stakeholders include the concerned ministries and agencies, regulatory authorities, financial institutions and NGO-MFIs, trade bodies and associations, and international organisations including the development partners. Further, the NFIS-B implementation plan has to be consistent and in tandem with other relevant development plans and programmes including the Eighth Five Year Plan (2021-2025) and Sustainable Development Goals (SDGs) targets. For achieving the financial inclusion goals, all stakeholders will have to play their specific and identified roles. Since financial inclusion is a cross-cutting issue, a strong coordination structure is necessary to help avert potential implementation bottlenecks; and by providing dedicated secretariat and budget to implement the NFIS-B. In addition, proper sequencing of the proposed activities will be crucial for achieving synergies and ensuring success. Thus, the successful implementation of NFIS-B will be dependent on adoption of a sound financing strategy for which a balanced mapping between and among public finances, private finance and development assistance will be critical. The framework for the interconnection and the affiliation between and among the above components need to be structured in terms of innovations in digital financial services (DFS); cottage, micro, small and medium enterprises (CMSMEs) financing, use of accounts, wages and government transfers, domestic remittances through accounts, formal savings mobilisation and other aspects to be included in the detailed Action Plan.Additionally, for achieving the financial inclusion goals of NFIS-B, it is necessary to monitor its performance as a regular key activity and as an integral component of the strategy. The integrated framework should identify a set of enablers which can drive the selected indicators to target values as the implementation of the strategy proceeds. In order to measure the progress of implementation and to assess the direct and indirect impacts on key financial inclusion indicators, it is essential to apply a well-designed monitoring and evaluation (M&E) framework. The M&E system will generate timely feedback for use by the stakeholders to evaluate the extent and the nature of the interventions. One of the major advantages of the framework would be its ability to measure success relative to the targets and provide values for understanding the success of the efforts and to suggest mid-term corrections to reach the targets, if necessary. The M&E framework of the NFIS-B will be based on the targets earmarked for the priority financial inclusion goals of the strategy. A comparison with the baseline values of each of these indicators will provide a measure of the current progress of financial inclusion in the country. The framework will also set interim benchmarks which would facilitate the implementation of specific actions outlined in the Action Plan. For the purpose, data from diverse sources need to be brought together, checked for their quality and conformity with set standards; and utilised to develop various individual indicators and compile the indicator data of financial inclusion. The compilation of financial inclusion measure may also require generation of additional data through opinion surveys, and rigorous periodic surveys. The task is huge, and it may require significant technical capacity not only in dealing with data collection and generation; it will also require intimate understanding of the complex world of financial transactions. Currently, no institution, agency or government department has the mandate of bringing together all required data and processing them to calculate indices for financial inclusion. Data remain mostly dispersed and of varied quality. In addition to technical capacity, a central server will be needed to bring all the data together for processing. The first step in moving towards calculating the financial inclusion indicator(s) is to take the administrative step to designate an institution/agency to take up the task. Therefore, a focal agency needs to be selected to do all the tasks.The operationalisation of the M&E framework is proposed in three steps. The first step will be identifying core and supplementary indicators. The core indicators will measure the performance of the core set of enablers of financial inclusion (e.g. access and usage indicators) and the supplementary indicators will measure the effectiveness and other dimensions of financial inclusion. The second step will be to develop the change dynamics and an appropriate M&E system to monitor the progress. The third step will be to develop reporting formats for each data source and identify a focal agency which will gather and compile data. The final step is estimating costs to implement NFIS-B and developing a resource plan including identifying the potential sources of fund. The process will include: (i) estimating the total resources required by different government and private sector agencies to implement the NFIS-B; (ii) indicating year-wise resource requirements for government agencies, regulators and the private sector to implement NFIS-B Action Plan; and (iii) identifying sources of resources such as government budget allocations, grant/loan funds from the development partners, equity or investment funds from local and international sources, and private sector financing.1.3 Objective of NFIS-B implementation and resource plan The overall objectives of this NFIS-B implementation and resource plan study is to develop a detailed year-wise implementation plan for NFIS-B with an accompanying M&E framework and activity-wise resource plan with sources of resources for the successful implementation of NFIS-B. The specific objectives are to: Implementation PlanUnderstand the roles and responsibilities of key stakeholders to identify the sources of financial inclusion data.Develop year-wise action plan (2020-2024)M & E Framework Identify the core and supplementary financial inclusion indicators which will be globally comparable for NFIS-B to develop a composite index of financial inclusion based on financial inclusion dimensions. Develop a theory of change and M & E system to monitor the progress. Develop reporting formats for each data source and identify a focal agency which will gather and compile data.Resource PlanEstimate the total resources required by different government agencies and private sector to implement the NFIS-B and indicate the sources of funds.Assess year-wise resource requirements for government agencies, regulators and private sector to implement NFIS-B Action Plan (2020-2024).1.4 Structure of the ReportIn addition to the introductory chapter (Chapter 1), the present document contains a total of six chapters. Chapter 2 provides a detailed discussion on operationalising NFIS-B coordination structure, which incorporates features of NFIS-B coordination structure; structure and responsibilities of NFIS-B National Council, Steering Committee and Advocacy Committee; identification of lead and associate institutions against each target and documentation of their roles. The chapter also conceptualises key stakeholders’ roles and their year wise action plan. Chapter 3 outlines year-wise implementation plan (2019-2024) of NFIS-B. It focuses on the specific activities to be implemented under each of the NFIS-B goals and targets. Chapter 4 discusses the monitoring and evaluation framework of NFIS-B, where focus has been given on identifying set of core and supplementary indicators against each target set in NFIS-B, and classifying role of Focal Agency in gathering and compiling data. Chapter 5 designs structure of NFIS-B progress reports. Finally, Chapter 6 offers mapping of year wise (2020-2024) resource plan of different financial sectors. The proposed TORs of NFIS-B National Council, Steering Committee, National Secretariat and Thematic Working Groups are provided in the Annexes. 2Operationalising NFIS-B Coordination Structure 2.1 Features of NFIS-B Coordination StructureThe NFIS-B outlines the need for an implementation structure that involves multiple stakeholders from both the public and private sectors, upon which will depend the timely achievement of financial inclusion targets. The structures will also help to ensure that synergies are extracted and duplication minimised.In order for the coordination structure to be successful, it needs to have a legitimate mandate and strong leadership anchored on the appropriate approval of the NFIS-B, supported by the right financial and human resources, and the appropriate mechanisms for monitoring and evaluation. It is also important for the coordination structure to be able to look at different avenues for cooperation and coordination, especially since there are a wide range of stakeholders involved. The NFIS-B coordination structure will be characterised by:(i) Strong leadership(ii) Clear mandate and terms of reference(iii) Transparent operating rules and procedures(iv) Balanced representation of all key stakeholders including the private sector(v) Required authority to take informed decisions, and(vi) Availability of the essential resources to perform the assigned tasks.The proposed coordination structure is organised into five tiers as outlined in section 2.2.2.2 NFIS-B National Coordination StructuresThe NFIS coordination structure as proposed in the NFIS-B is comprised of three main committees (National Council, National Steering Committee and the National Advocacy Committee), supported by the NFIS-B Secretariat (Figure 1). In this implementation strategy, it is proposed to further augment these with thematic working groups, as further proposed below.Figure 2.1: NFIS-B Coordination Structure2.2.1 National Council – Structure and Responsibilities The NFIS-B National Council (NNC) is the supreme strategic authority for implementation of NFIS-B and moving the national agenda for financial inclusion in Bangladesh. The NNC provides the vision, strategic direction and required guidance and oversight in implementing the financial inclusion agenda. The NNC will be chaired by the Minister, Ministry of Finance. Membership will be limited to ministers and senior government officials, including the Governor of Bangladesh Bank, Senior Secretaries in the Ministry of Finance (Finance Division and Financial Institutions Division); Planning; Local Government, Rural Development and Cooperatives and other related ministries. The NNC is anticipated to meet once or twice every year to review progress and provide overall direction.The Terms of Reference of the NFIS-B National Council is attached as Annexure 1.2.2.2 NFIS-B Steering CommitteeThe NFIS-B Steering Committee (NSC) will have overall responsibility of coordinating the implementation of the NFIS-B following the guidance of the NNC. The NSC will be responsible for ensuring effectiveness and quality control in all activities under the financial inclusion agenda. The NSC will be chaired by the Governor of the Bangladesh Bank, while members will include senior officials and representatives responsible for implementation from various ministries and agencies, for example Ministries of Finance, Planning, Agriculture, Women & Children Affairs, Commerce, Industry, Social Welfare, Post and Telecommunications, and Education. Other members will include sector regulators including BB, BSEC, MRA, IDRA and BTRC, Department of Cooperatives, BPO, and others as needed.The Terms of Reference of the NFIS-B Steering Committee is attached as Annexure 2.2.2.3 NFIS-B Advocacy CommitteeThe NFIS-B Advocacy Committee (NAC) will provide a forum for the private sector to support the implementation of the NFIS-B, being the main platform for the public-private partnership and policy advocacy on financial inclusion at the national level. The NAC will be the forum for having the recommendations from the practitioners, implementing partners, academia and the financial service providers. The NAC will be chaired by Secretary, Financial Institutions Division of the Ministry of Finance.The Terms of Reference of the NFIS-B Advocacy Committee is attached as Annexure 3.2.2.4 Thematic Working GroupsThe thematic working groups will bring together all stakeholders with a keen interest in a specific area. The thematic areas align to the Alliance for Financial Inclusion (AFI) thematic working groups, but are further modelled to focus on the most critical areas of financial inclusion in the Bangladesh context. These groups may be changed over the course of NFIS-B implementation, to best align the implementation process to stakeholders’ interest and motivation.To begin with, five thematic groups are proposed as follows:Financial sector deepening, especially focusing on Goal 1, Goal 5, Goal 9 and Goal 11 of NFIS-B.Digital financial services focusing on payments (Goal 2) and DFS / innovation (Goal 6).CMSMEs, focusing on SMEs and capital market issues under Goal 1 and Goal 10.Consumer empowerment and risk management focusing on Goal 4 and Goal 8.Data and measurement focusing on Goal-3. The working groups will propose based on in-depth analysis, way forward on specific issues considering technical and other implications towards achieving specific NFIS-B objectives. The proposed Terms of Reference of the NFIS-B Thematic Working Groups is attached as Annexure 4.2.3 NFIS-B National SecretariatThe NFIS-B National Secretariat will be established at the Bangladesh Bank (BB) to provide technical support to the coordination bodies outlined above. Already, at the BB there are a number of departments that have strongly supported the development of the NFIS-B, and thus the senior management at BB will designate one of these departments to provide the Secretariat services. These core departments supporting financial inclusion at the BB include the Sustainable Finance and the Financial Inclusion Departments.The Secretariat once designated will be responsible to perform all operational, administrative, technical research and secretarial activities for the implementation of NFIS-B, in support of the activities to be carried out by the NNC, NSC and NAC. The Secretariat will also provide financial inclusion data support, providing M&E and statistical analysis for financial inclusion issues in Bangladesh. As such, it will collect supply side data (from various sector regulators and BBS), maintain MIS and prepare M&E reports. A further related task is the coordination and collection/collation of demand side data. Within this context, the Secretariat will be responsible to partner with other agencies and development partners to conceptualise and operationalise a comprehensive demand side survey as called upon in the NFIS-B. The Secretariat will be headed by an Executive Director of BB, deputised by a General Manager. The organisational structure of the Secretariat and all appointments will be made and approved by the Head of NSC, i.e. the Governor of Bangladesh Bank. The Governor will ensure that adequate operational and administrative budget is allocated.The Secretariat will work with all stakeholders to raise awareness and to drive forward critical issues in financial inclusion. As such, it will need to establish a permanent mechanism to coordinate with the regulatory bodies, industry associations, donor partners, and other stakeholders. The National Secretariat of NFIS-B Charter is attached as Annexure 5.2.4 Mapping and Identification of Lead and Associate InstitutionsThe implementation of the NFIS-B, being a multi-stakeholder task, requires effective and timely collaboration among all concerned stakeholders. For the purpose, lead and associate institutions for each target are proposed (Table 2.1). Table 2.1: Mapping/identification of lead and associate institutions for individual targetsGoalsTarget NumberTargetsLead InstitutionsAssociate InstitutionsIncrease financial deepening1Introduce e-KYC for all types of bank accounts, MFS accounts and other regulated financial services accountBB, MRA, IDRA, BSEC, National Identity Registration Wing (NIDW) of Election CommissionFID (MoF), Information and Communication Technology Division (ICTD), Ministry of Posts, Telecommunications and Information Technology, BTRC, Banks, NBFIs, MFIs, MFS Providers, Bangladesh Post Office (BPO), Insurance Companies2Revisit the KYC requirement for cottage and micro enterprises, micro-merchant/retails businesses and low-income households.BB, MRA SME Foundation, BSCIC, Ministry of Industries, Ministry of Commerce, Trade bodies, Banks, NBFIs, MFIs3Ensure the access of all regulated financial service providers to ‘National ID database’ of Election Commission and ‘Biometric Database’ of Bangladesh Telecommunication Regulatory CommissionBB, MRA, IDRA, National Identity Registration Wing (NIDW) of Election CommissionMinistry of Home Affairs, BTRC, Banks MFIs, Insurance Companies4Introduce the framework for ‘socially responsible financing’BBBanks and NBFIs5Expand the scope and practice of ‘Cluster’ and ‘Value Chain’ financing.BB, MRA, Ministry of Industries, SME Foundation, PKSFBanks, NBFIs and MFIs6Take necessary initiatives for making account opening process as optimally simple and convenient for allBB, MRA, IDRA, Banks, NBFIs, MFIs, Insurance Companies7Develop framework for diversifying financing instruments and financing options for CMSMEs and low-income householdsBB, MRA, BSEC SME Foundation, BSCIC, PKSF FID (MoF), Ministry of Industries, Ministry of Commerce, Trade bodies, Banks, NBFIs, MFIs 8Take necessary actions to reduce fiscal burden on the usage of financial services for consumers specially in DFSBB, MoF (Finance Division), BTRC, NBR, Ministry of Posts, Telecommunication and Information Technology 9Establish Micro-Finance Credit Information Bureau (CIB), Collateral (both movable and immovable) Registry Bureau for financial services and upgrade the existing CIB under Bangladesh Bank into full fledged ‘Credit Registry’MRA, BB, MoF (FID/Finance Division), MRA, MLJPABanks, NBFIs and MFIs10Introduce the usage of artificial intelligence and machine learning for credit scoring and monitoring through big data analysisBB, MoF (FID/ Finance Division), A2i, BSEC, NFIS secretariat, Private Sector Rating Agencies, Banks, Venture Capital Investment Companies, 11Introduce ‘Credit Guarantee Fund’ for CMSME finance, agricultural finance and green financeBB, MoF (FID), SME FoundationBSCIC, PKSF, Ministry of Agriculture, Ministry of Commerce, Trade bodies, Banks, NBFIs, MFIs12Take necessary initiatives for developing refinancing mechanism for funding ‘Start-ups’BB, BSEC, MoF (FID)Venture capital financing companies, Banks, NBFIs 13Make required arrangement for facilitating smooth inward remittance of domestic professionals on Business Process Outsourcing and NRBsBB, MoF (Finance Division), NBR,, MRA|Ministry of Expatriates’ Welfare and Overseas Employment, Ministry of Labour and Employment, Ministry of Foreign Affairs, Banks and MFIs14Formulate policy framework for Micro-savings by BB and MRABB, MoF (FID), MRABanks and MFIs15Explore the feasibility to introduce 'P2P Lending' and 'Crowd Funding'BB, BSEC, MoF (FID)Venture capital financing companies16Create mechanisms of robust information sharing for convenient client on-boardingBB, MRA, A2i, Ministry of Posts, Telecommunications and Information Technology2. Strengthen payment system and service delivery channel17Ensure interoperability within all MFS accountsBB, MoF (FID), BTRCBanks, MFS providers, Fintechs, 18Ensure interoperability within all MFS and bank accountsBB, MoF (FID), BTRCBanks, MFS providers, Fintechs,19Ensure the transformation of all branches of all banks into online branchesBB, MoF (FID), SOCBsBanks, Fintechs,20Ensure the participation of all banks in interbank Automated Teller Machines (ATM), Point of Sales (POS) and Internet Banking Fund Transfer (IBFT)BB, MoF (FID), SOCBsBanks, Fintechs,21Establish a ‘Payment System Coordination Council’ consisting of relevant regulatory bodiesBB, MRA, MoF (FID), SOCBs, BTRC, NFIS-B Secretariat Banks, MFS providers, BPO, Fintechs, MFIs22Bring all types of Government payments (P2G and G2P) including social security payments under financial services (either bank account or MFS account)Cabinet Division, Ministry of Social Welfare (MoSW), MoWCA, BB, MRA, MoF (FID/Finance Division), NFIS Secretariat, MoPEMR, MoWR, BNBRBanks, MFS providers, Fintechs, Payment Service Providers (PSP),, MFIs, BPO23Take necessary initiatives to digitize ‘Micro-Merchant Payments’ and ‘Retail Transport Payment’BB, MoF (FID), BTRC, FBCCI, Banks, MFS providers, Fintechs, Payment Service Providers (PSP), BPO, SME Foundation24Enhance the scope of MFI linkage for providing banking and MFS servicesBB, MoF (FID), BTRC, MRA, MFS Providers, , NFIS SecretariatBanks, MFIs, PKSF25Enhance the scope of financial service providing by PSPsBB, MoF (FID and Finance Division) , BTRC, Ministry of Posts, Telecommunications and Information Technology PSPs, Fintechs26Initiate the formulation of National Payment ActMLJPA, BB, MoF (FID), BTRC, Ministry of Posts, Telecommunications and Information Technology27Assess the feasibility of establishing payment bankBB, MoF (FID), MLJPA, BTRC, Ministry of Posts, Telecommunications and Information Technology3 Establish robust Data and Measurement framework28Conduct a comprehensive country-wide demand side survey to appropriately assess the financial serviceBB,NFIS SecretariatBBS29Establish a set of globally comparable national financial inclusion indicators in light of World Bank Findex, IMF Financial Access Survey and G20 Financial Inclusion IndicatorsBB, MoF (FID and Finance Division), NFIS SecretariatBBS30Ensure the collection of comprehensive and quality financial inclusion data disaggregated by sex, age, location and other aspects MoF (FID and Finance Division), NFIS Secretariat, BB, MRA, IDRABBS31Create robust and automated Management Information System and dedicated web-portal for NFIS-B data like SDG TrackerMoF (FID and Finance Division), NFIS Secretariat,A2i32Explore the potential ways for using ‘Cloud Solutions’ to store and preserve data by Financial Service Provider and Regulatory AgenciesMoICT, NFIS Secretariat, MoF (FID and Finance Division), BBA2i, Ministry of Posts, Telecommunications and Information Technology33Strengthen the capacity of statistical agency for national financial inclusion dataNFIS Secretariat, Statistics and Information Division of Ministry of Planning (MoP), MoF (FID)BBS4. Promote Financial Literacy and Consumer Empowerment34Formulate Financial Literacy Policy/Strategy by all financial sector regulatory bodies separatelyNFIS Secretariat, MoF (FID/ Finance Division), Ministry of Primary and Mass Education (MoPME), MoEBB, MRA, IDRA, BTRC 35 Formulate Consumer Protection Framework and Grievance Redressal System by all financial sector regulatory bodies separatelyBB, MoF (FID/Finance Division), NFIS Secretariat BB, MRA, IDRA, BTRC36 All regulated financial service provider will have annual program on financial literacy which will be monitored by respective regulatory bodyNFIS Secretariat, MoF (FID/ Finance Division), Ministry of Primary and Mass Education (MoPME), MoE, BB, MRA, IDRA, BTRCBanks, NBFIs, MFIs, Insurance companies37 Take necessary initiatives with Ministry of Education to incorporate ‘Financial Literacy’ at all levels of education (Primary, Secondary, Tertiary)NFIS Secretariat , BB, MoF (FID/ Finance Division), Ministry of Primary and Mass Education (MoPME), MoE, Educational Institutions 38Assess the feasibility of introducing consumer protection mechanism similar to ‘Deposit Insurance Scheme’ for banksBB, MoF (FID), MRABanks, MFIs5. Broaden and Deepen Financial Inclusion of Women, Population affected by Climate Change and other underserved segment of population39 Develop separate policy/strategy and undertake special programs by all regulatory bodies of financial sector on women financial inclusion covering the issues below:Dedicated focus on catering the need financial services (saving, credit, payment, investment and insurance) of women individuals and entrepreneurs from both rural and urban areasConvenient service delivery channel for womenSeparate focus for women in DFSBB, MoF (FID), BTRCMinistry of Women and Children Affairs, Ministry of Posts, Womens Entrepreneur Association, Telecommunications and Information Technology, Banks, NBFIs, MFIs, Insurance companies, MFS providers, Fintechs, PSPs, BPO40Formulate target based specific policies and initiate dedicated programs by IDRA, BSEC and MRA as well as relevant government agencies on Financial Inclusion and Climate Change along with the reinforcing BB’s initiativesBB, MoF (FID), Ministry of Environment, Forest and Climate Change (MoEFCC), Ministry of Disaster Management and Relief (MoDMR)MRA, IDRA, BSEC41 Formulate target based specific policies and initiate dedicated programs by all regulatory bodies and relevant government agencies on following aspects of financial inclusion separately:Youth Financial InclusionFinancial Inclusion for Physically Challenged PeopleFinancial Inclusion for Third GenderFinancial Inclusion for ChildrenFinancial Inclusion for Bangladeshi Diaspora/Non Resident Bangladeshi (NRBs)Financial Inclusion for extremely destitute and underprivileged people like tea labourers, floating communities, urban slum dwellers, poor people in remote hilly, forest, coastal, haor, char with difficult terrain and similar areas; former enclave areas, sparsely populated areas and relatively underdeveloped areas with poor infrastructureMoF (FID/ Finance Division), BB, MRA, IDRA, Ministry of Social Welfare, Ministry of Women and Children Affairs, Ministry of Expatriates’ Welfare and Overseas Employment, Ministry of Labour and Employment, MoEFCC, MoYS, MoLG, MoEW, Banks, MFIs, Insurance companies, PKSF 6. Upscale Digital Financial Services and Fintech42Formulate a DFS strategyBB, MoF (FID/ Finance Division), BTRC, MoICTA2i43Ensure the usage of DFS in all types of utility services (water, gas, electricity, internet, health, education and others) payments NFIS Secretariat , BB, MoF (FID/ Finance Division), BTRCBanks, MFS providers, Fintechs, PSPs, Utility providers44Assess the feasibility of application of Distributed Ledger Technology (DLT) in financial sectorBB, MoF (FID/ Finance Division), a2iPrivate sector 45 Explore the potential modalities to introduce credit service and full deposit service for MFS account holdersBB, MoF (FID/ Finance Division), BTRCBanks, MFS providers, BPO 46 Explore the potential solutions to provide all banking services at full scale in outlet level under agent bankingBB, MoF (FID/ Finance Division)Banks47Assess the potential scope of application of Fintech, Regtech, Suptech, InsurtechNFIS Secretariat, MoICT, MoF (FID/ Finance Division), BB, MRA, IDRA, BTRCA2i7.Strengthen the policy and regulatory environment48Coordinate across Ministries, Regulatory Bodies and relevant government agencies for implementation of NFIS-BNFIS Secretariat, MoF (FID/ Finance Division)Relevant Ministries, BB, MRA, IDRA, BTRC, BSEC 49Establish the practice of evidence based policy makingNFIS Secretariat, MoF (FID/ Finance Division)BB, MRA, IDRA, BTRC, BSEC50 Reinforce the coordination and coherent effort to refrain illegal financial services and eliminate the adverse impacts of Shadow BankingNFIS Secretariat, MoF (FID/Finance Division), BB, MRA, IDRA, BTRC, BSEC51Explore the potential ways to introduce ‘Regulatory Sandbox’NFIS Secretariat , MoF (FID/ Finance Division)BB, MRA, IDRA, BTRC, BSEC52Devise appropriate ‘incentive structure’ by regulatory bodies for financial service providers to penetrate low-income marketsBB, MRA, IDRA, BTRC, BSEC, NFIS-B Secretariat53Strengthen the capacity of regulatory agencies on data-driven policy analysis and emerging technologies like Fintech, Regtech, Suptech, Insurtech, Artificial Intelligence, DLT, Machine Learning, Augmented Reality, Cyber SecurityNFIS Secretariat, MoF (FID/ Finance Division), A2i, Ministry of Posts, Telecommunications and Information TechnologyBB, MRA, IDRA, BTRC, BSEC8. Fortify risk management of financial inclusion initiatives54Ensure proper application of the core principles (set by Bank for International Settlement) for effective banking supervision to the regulation and supervision of institutions relevant to financial inclusionNFIS Secretariat , MoF (FID/ Finance Division), BB, MRA, IDRA, BTRC, BSEC55Take necessary initiatives to balance the Anti-Money Laundering (AML) and Combating Terrorist Financing (CFT) regulations and innovation in financial inclusion drives through ensuring Financial Integrity for reducing the practice of ‘De-risking’BFIU,NFIS Secretariat MoF (FID/ Finance Division), BB, MRA, IDRA, BTRC 56Develop framework for assessing risk during financial product developmentMoF (FID/Finance Division), BB, MRA, IDRA, BTRC57Develop robust regulatory and supervisory apparatus to protect data privacy and securityMoF (FID/Finance Division), BB, A2i, Ministry of Posts, Telecommunications and Information Technology, MoICTNational Identification Wing, Election Commission9. Strengthen the insurance services58Develop policy framework Micro-insurance by keeping provision of using MFI linkage to reaching beneficiariesMoF (FID/Finance Division)MRA, IDRA59Introduce ‘Bancassurance’ to diversify service opportunity to consumersMoF (FID/Finance Division), BB, IDRA Banks, Insurance companies 60Introduce innovative insurance products for marginal people, small business and agriculture like weather based crop insurance, health insurance for low income peopleMoF (FID/Finance Division), NFIS Secretariat, BIA, MoAg, MSW, MoH, BB, IDRA Insurance Companies, MFIs10 Reinforce the capital market services61Deepen the capital market to expand the participation of individuals and businesses and introduce a wider range of financial instruments for investmentMoF (FID/Finance Division), BSEC Dhaka Stock Exchange (DSE), Chittagong Stock Exchange (CSE), private sectors 62Expand the scope of usage alternatives investments like venture capital, impact fund, AIF, SPV for CMSME finance, agricultural finance and green finance at remote rural levelMoF (FID/Finance Division), BB, BSEC, MRA, venture capital companies, SME foundation, Ministry of Agriculture, Ministry of Commerce Venture Capital Investment Companies, Banks, NBFIs. MFIs63Develop bond market to facilitate risk-averse retail and small investorsMoF (FID/Finance Division), BSECDSE and CSE 11. Fortify Micro finance services64 Increase the access to diverse source of fund by MFIsMoF (FID/Finance Division), MRA, PKSF, NFIS Secretariat, BSEC, Bangladesh Investment Development Authority (BIDA) MFIs65Initiate ‘digitization’ of relatively small scale MFIs to increase their efficiencyMoF (FID/Finance Division), MRA, PKSFMFIs12.Strengthen Quasi-Regulated Financial Service Providers like BPO, BHBFC, BMDF, PKSF, Samabay Bank, Ekti Bari Ekti Khamar and Palli Sanchay Bank to facilitate their financial services by complying applicable regulatory requirements.MoF(FID), BPO, BHBFC, BMDF, PKSF, Samabay Bank, Ekti Bari Ekti Khamar and Palli Sanchay Bank2.5 Role Identification of Lead and Associate Institutions As mentioned earlier, the implementation of NFIS-B needs effective coordination amongst all relevant stakeholders identified in Table 2.1. The ministries will have to coordinate among themselves for budget allocation and implementation of relevant targets. The regulatory authorities will provide the policy and technical support for implementing financial inclusion initiatives. The financial institutions will have to be cost effective and efficient in delivering products and services consistent with demands of different groups. Finally, the trade bodies and other associations will have to play supportive role in implementing the NFIS-B on time. 2.6 Key Stakeholders’ Roles and Responsibility MatrixIt is to be noted that all the stakeholders will have to play their specific and identified roles. The roles and responsibilities of key stakeholders are summarised in Table 2.2.Table 2.2: Roles and responsibilities of key stakeholdersCategoryInstitutionsRole / responsibilityMinistry / agencyPrime Minister’s Office,Ministries of Finance (Finance Division and FID), Planning, Local Government, Rural Development and Cooperatives, Posts andTelecommunicationsCoordinationBudget for new initiatives and coordination among the financial sector regulators Implementation ensuring quality and in compliance with policy framework, available best practices and meeting all design criteria.Regulatory authorityBangladesh Bank, BTRC, MRA, IDRA, BSECRegulatory and supervisory frameworks supportive of financial inclusion for allPolicy and technical support for implementing financial inclusion initiativesDirectives and guidance to financial and related institutions on achieving financial inclusion targetsFinancial institutions and MFIsBanks, NGO-MFIs, Insurance companies, MFS providers, BPOCooperatives, etc.New and innovative products and services consistent with demands of different groupsDelivery methods to suit the needs of different customer groupsCost effective and efficient products and services through applying new technologiesApex organisationsPKSF, SME FoundationWholesale lendingPilot innovative financial products Trade bodies and associationsFBCCI, DCCI, MCCI, Woman Entrepreneurs Association, SMEsassociation and othersArticulate demand side issues on financial inclusionSupportive actions for financialinclusion2.6.1 Financial Service Providers and the NFIS-BFinancial Service Providers will be critical in implementing the NFIS-B, and are expected to perform the following roles (but not limited to):Adopt customer-centric approach to design products tailored for underserved markets;Connect existing distribution channels to a broader suite of financial services. For example, partnerships can allow bank deposits or insurance products to be distributed directly through MFS or MFIsCapitalise on No Frill products to expand coverage and rapidly upstream customers onto unrestricted accounts;Capitalise on new infrastructure and technology to reinforce the product development, service channelling and risk managementBuild institutional framework for establishing responsible and ethical service providing practicesDesign tailor-made credit products for CMSMEs and low-income householdsUndertake persistent financial literacy programs for women, youth, children, and underserved segment of population especially in urban marginal economic segment and rural remote areasWork closely with regulatory and government authorities to build common industry infrastructure and Open-Application Programming Interfaces2.6.2. Development Partners and the NFIS-BDevelopment partners act as the catalyst for change in both the public and private sectors. Their role over the life of the NFIS-B may be summarised as follows:Partnering with policy makers and regulatorsProvide support to policy makers, regulators and service providers to address complex issues like sector digitisation, interoperability, innovation and sector transformation.Build data analytics capacity within the public sector to enhance evidence based decision making, and also to track access, usage and quality of financial services.Facilitate dialogue between private and public sector on various issues e.g. consumer protection policy and regulatory development, and reinforces platforms for collaboration across stakeholders to shape policy change.Work with regulators and service providers to develop all the sectors, but with particular focus on traditional and alternative financing market including impact investment, bond market and strengthening the insurance sector.Support regulators and government agencies in tackling the emerging issues like Fintech, Regtech, Insurtech, DLT, Artificial Intelligence, Machine Learning.Harmonize resource deployment to avoid duplication.Working with financial service providersWork with private sector to develop customer-centric and data driven financial products and services.Mobilise resources to support high risk, experimental financial products and services.Provide financial and technical support to enhance financial infrastructure.Facilitate low cost funding to boost financing in critical areas such as climate resilient business, socially responsible ventures, start-ups and women financial inclusion.Provide support in ensuring affordable internet and mobile technology to all.Provide support for financial literacy programmes2.6.3 Role of Bangladesh BankThe key implementing agency of NFIS-B will be Bangladesh Bank. The roles of Bangladesh Bank in this case will be as follows:The Governor of Bangladesh Bank will chair the NSC, and in conjunction with the Ministry of Finance will provide broad leadership and oversight in the entire NFIS-B implementation process;The Bangladesh Bank will implement many of the policies and strategies called upon in the NFIS-B, as regulator of the bank, non-bank and payments market sectors.The structure and the ToR of the NFIS-B Secretariat will be decided upon by the Governor, who will also provide the relevant administrative and operational approvals and infrastructure;Bangladesh Bank will prepare a draft financing strategy for implementation of NFIS-B which will be placed in the first meeting of NNC for approval.2.6.4 Role of Ministry of FinanceThe Ministry of Finance will, in conjunction with the Bangladesh Bank, provide overall direction and political leadership to the NFIS-B implementation process. The Financial Institutions Division of the Ministry of Finance will be the line Ministry responsible for the implementation of NFIS-B, working together with the Bangladesh Bank in leading the day to day implementation process.3Operationalising NFIS-B Action PlanThe NFIS-B represents the stakeholders’ consensus on the high level financial inclusion vision and objectives to be achieved in Bangladesh over the next five years. The strategic goals and targets of NFIS-B, in the form of 12 goals and 65 targets further define how the overall vision and objectives are transformed into a concrete set of actionable items to drive future developments in financial inclusion. The strategic goals and targets will be implemented in parallel with other broader “business as usual” initiatives in both the public and private sectors.The strategy will help to systematically accelerate financial inclusion by raising awareness on financial inclusion challenges, building trust and collaboration among all stakeholders, and by providing a clear roadmap on how to implement and coordinate the financial inclusion initiatives. The implementation of NFIS-B is therefore a multi-stakeholder task which requires effective and timely collaboration among all concerned stakeholders, with the key stakeholders being the concerned ministries and agencies, regulatory authorities, financial institutions and NGO-MFIs, trade bodies and associations, and international organisations including the development partners. In order to achieve the overall financial inclusion goals, each stakeholder will need to play their specific and identified roles, hence the importance of an agreed year-wise implementation plan.In this section, the NFIS-B year-wise implementation plan (2020-2024) is outlined, focusing on the specific activities to be implemented under each of the NFIS-B goals and targets. The implementation plan emanates from and is an integral component of the NFIS-B. The proposed prioritisation, actions, and timelines have been validated through discussions with concerned stakeholders as needed.3.1 NFIS-B Outcomes and Objectives/TargetsThe broad objectives of the NFIS-B are at the highest level encapsulated within the following strategic vision: “An integrated financial system supportive to rapid and inclusive development of the country’s potential sectors, be accessible and be responsive to the needs of the population such that they can regularly use financial products and services to manage their cash flows and needs of livelihoods, and mitigate shocks as needed at individual, household and enterprise levels”. The vision is further supplemented by three core dimensions:All adults have individual, full-service, safe and secure regulated financial service account facilitated by technology.Each account holder has access to electronic financial service points within acceptable distance having cash deposit, withdrawal and transfer facilities in a secure environment and at reasonable charges.All households and businesses have convenient access, at reasonable prices/charges, to: (i) a full range of appropriate regulated credit and other financial products; (ii) appropriate deposit and investment products; (iii) a range of insurance (including micro insurance) and risk management products; and (iv) legally protected rights to be offered only appropriate financial products and services by the providers and the right to make informed decisions.The NFIS-B vision thus encompasses two mutually reinforcing aspects: (i) finance for growth and development; and (ii) access to finance for all, within the context of a stable and inclusive financial sector able to promote the country’s social transformation and achieve the development vision of the Government of Bangladesh. The following outcomes of financial inclusion are thus prioritised:Expanded access to financial services, including to marginalised populations such as the low income segments, rural and agricultural households, women, youth, and other vulnerable populations;Increased usage of financial services across all segments; High quality of the products and service delivery mechanisms.Availability of finance and capital to CMSMEs including in Agriculture, and including socially responsible finance mechanisms such as green finance.Increased digitisation of financial services to support efficiency, transparency, reach and innovation. Digitization must go hand in hand with digital literacy, and cybersecurity and data protection measures to ensure a secure environment for providers and customers.Enhanced financial literacy of customers, and adequate customer protection measures. This must include minimising negative impacts of financial inclusion such as over indebtedness.Expanding coping mechanisms for poor households especially through microinsurance, micro savings and mechanisms aimed at helping them cope with climate change.Alternative investment opportunities for citizens and businesses, especially through the capital marketsUltimately financial inclusion is a means to an end and the improving levels of financial inclusion must translate into support for the Sustainable Developments Goals and the National development plans and strategies, as further outlined in the NFIS-B.Quantitative targets against each of these objectives have been set out in the M& E section.3.2 Prioritisation and Sequencing of ActivitiesIn the sequencing of activities, a number of aspects are considered:Priority matrix: Each action envisaged will have a specific impact on the NFIS-B financial inclusion journey. Stakeholders have rated each of the 65 targets as high, medium or low priority, depending on their potential impact, as further outlined in the detailed implementation plan matrix. Where possible, high priority items (i.e. those with a higher impact) are implemented first.Dependence of activities: Some high priority of activities may depend on or be complementary to lower priority items, requiring such low priority activities to also be implemented early even though on their own they are of limited impact.On-going activities: Activities that are already funded and on-going need to be continued, and thus these are also prioritised as noted further in the implementation matrix.The sequencing of activities has been approximated by designating an implementation timeline, under the following definition:Short term: 2020 – 2021Medium term: 2022 – 2023Long term: 2023+During implementation, it is inevitable that more research will be needed within the stated broad framework, and both past and on-going experience and pragmatic research in the arena of financial inclusion will give valuable insights and guidance to future policy especially relating to re-sequencing of interventions as may be needed.As financial inclusion evolves in Bangladesh, it is also worth to put the transformation journey especially for poor households, into perspective. Payment products often lead adoption of other financial products, providing the best entry point for financial inclusion as it reinforces the uptake of other financial products. Payment products and digital financial services have become intertwined, and this has further benefits because as the electronic payment transactions become widespread they provide customers some familiarity and trust in the financial system, and to the provider some useful insights about the consumers (e.g. credit worthiness) that enable them to offer additional suitable products. The further hierarchy of consumer financial needs is eventually determined by the specific needs of different groups.Bangladesh has made significant progress by providing credit and savings products through MFIs, and these provide a unique way of increasing the outreach at grassroots level with the ability to make best use of available resources through the delivery of efficient and poor-friendly products.3.3 NFIS-B Implementation PartnersThe comprehensive nature of NFIS-B requires that its implementation involve multiple stakeholders covering both public and private sectors along with a well-defined coordination structure to ensure synergies and timely achievement of the targets. The coordination structures allow the wide range of stakeholders from public and private sector institutions to work together, and ensure that the activities of each stakeholder including the policies and regulations enacted by the financial regulators all have a positive impact on financial inclusion. Effective public-private partnerships and collaborations are essential to significantly advance financial inclusion in the manner envisaged under NFIS-B, especially under the rapidly changing financial landscape of Bangladesh. The key implementation stakeholders are identified as follows.Coordination bodiesThe central coordination structures comprising the NFIS-B National Council (NNC), the NFIS-B Steering Committee (NSC), the NFIS-B Advocacy Committee (NAC), and the NFIS-B SecretariatRegulatory authorities and ministriesThe roles of regulators, government agencies and policy makers are crucial. In particular, as the implementer of monetary and credit policies and regulator and supervisor of banks, the role of Bangladesh Bank (BB) in financial inclusion is important, and involved departments include the Financial Inclusion department, Sustainable Finance, SME & SPD, Banking Regulation and Policy Department (BRPD), Agricultural Credit, Bangladesh Financial Intelligence Unit (BFIU) and other related Departments who are involved in the formulation of the regulatory framework and guidelines for operation of banking activities. Besides the Bangladesh Bank, other relevant regulatory institutions include the MRA, IDRA, BSEC and BTRC that also play an important role in promoting inclusive finance through microfinance, insurance and mobile banking. Furthermore, as the policy makers for banks, financial institutions and economic matters, the Ministry of Finance (Financial Institutions Division in particular) is a lead stakeholder, as well as a number of other Ministries shown in Table 3.1.Table 3.1: List of selected regulatory bodies and ministriesRegulatory bodies1. Bangladesh Bank 2. Microcredit Regulatory Authority (MRA) 3.Insurance Development and Regulatory Authority (IDRA)4.Bangladesh Securities and Exchange Commission (BSEC)5.Bangladesh Telecommunication Regulatory Commission (BTRC)Ministries/Agencies1Ministry of Finance (Finance Division, Economic Relations Division, Financial Institutions Division)2.National Board of Revenue3.Ministry of Planning (General Economic Division and Statistics and Informatics Division)4.Ministry of Local Government Rural Development and Cooperatives5.Ministry of Youth and Sports6.Ministry of Women and Children Affairs7. Ministry of Commerce8.Ministry of Agriculture9.Ministry of Education 10.Bangladesh Bureau of Statistics11.Ministry of Posts, Telecommunications and Information Technology (Posts and Telecommunications Division) Financial Institutions Financial institutions including Banks, NBFIs, MFIs, Insurance Companies are the implementers of the required products and services. These are further summarised as follows:State owned commercial banks and specialised banks who have a large share of rural deposits and advances and have large safety net beneficiary accounts,Private Banks that provide a wide range of financial services to individuals and CMSMEs, including mobile financial services and agent banking facilities.Bankers Associations - Association of Bankers , Bangladesh (ABB), and Bangladesh Association of Banks (BAB)Microfinance institutions, including NGO-MFIsMFI apex funding organisation, PKSFNational association of microfinance in Bangladesh, Credit and Development Forum (CDF)Government agency for microfinance, PDBFLife and non-life insurance companiesBangladesh Insurance AssociationCapital market intermediaries Selection of other providers such as Post Office, Bangladesh Rural Development Board (BRDB), Cooperatives and othersTrade Bodies and Associations including FBCCI, DCCI, MCCI, along with Women’s’ Entrepreneur Association, BSCIC and SME Foundation.3.4 Year-wise Implementation Plan: 2020-2024The year-wise Implementation Plan 2020-2024 focuses on identifying the activities that need to be carried out to achieve each of the 65 targets, and the lead and supporting institutions for each activity, through a consultative process. It is important to note that an institution can be lead or supporting depending on the activity being considered. For example, when it comes to regulations of financial institutions then Bangladesh Bank or the relevant ministry will be the lead institution. On the other hand, when it comes to implementation of any financial inclusion activity, financial institutions may be the lead institutions.The NFIS-B year wise implementation plan 2020-2024 provides a summary of the priority goals and targets which have been identified as drivers and enablers of financial inclusion within the framework of NFIS-B, and for each, the expected result, the respective activities needed to achieve it, the lead and support institutions, the activity timeline, the indicators of success, and the priority assigned by the stakeholders. The NFIS-B year wise action plan is attached as Annexure 6. Along with this, priority actions set by Bangladesh Bank and different ministries are attached as Annexure 7.4Operationalising NFIS-B M&E System4.1: Setting Targets in Line with the Anticipated Objectives/Outcomes of NFIS-BThe Monitoring and Evaluation (M&E) system will measure success relative to the set targets. These targets are quantified subcomponents to contribute to the achievement of the given sets of objectives/outcomes. Targets are quantified keeping in mind the broad objectives of NFIS-B that focuses on increasing the level of financial inclusion (having at least one regulated financial service account) of all adults to 100 percent by 2024; ensuring the availability of a wide range of financial products and services; developing the financial system to assure quality, relevance, and responsiveness of the financial products and services; creating effective interface using technology between financial products and services as well as delivery channels used by different providers such as banks, nonbank financial institutions, insurance companies, post offices, MFIs and other institutions; expanding financial literacy and education supplemented by strong consumer and enterprise empowerment; and create statistical capacity of regulatory bodies to collect and disseminate comprehensive and quality financial inclusion data. Though there is no universally accepted mechanism to set targets, most of the recently formulated national financial inclusion strategies and supportive documents prescribed or used some common approaches. Identifying current financial inclusion levels related to savings account, credit accounts, and mobile money accounts by the adults and also by the vulnerable groups are fundamental steps to adjust for future targets. Latest available data by the World Bank Global Financial Inclusion (Findex) and IMF Financial Access Survey (FAS) are used to identify ‘Benchmark Year’ (2017) and the projection bases for the following years. The inclusion status and growth of the countries (as per Findex and FAS) with similar socio-economic and other related conditions offered valuable lessons in determining projected figures for Bangladesh. In quantifying the targets, data on the developing countries especially India’s trends and growths are used extensively. Projected growth rates for 2017-2020 are kept at a level not higher than the preceding three years (2014-2017). Population growth rate of 1.04% (2017) is adjusted yearly to project future increase in the adult population of the country. Table 4.1 quantified 15 broad targets [T1-T15] for financial inclusion. Table 4.1: Quantified Targets for Measuring Financial InclusionTargets2014Status2017 [Benchmark] Yearly Growth [2014-17] 2020[Target & Yearly Required Growth]2021[Target & Yearly Required Growth]2022[Target & Yearly Required Growth]2023[Target & Yearly Required Growth]2024[Target & Yearly Required Growth]Basis for Determining Benchmark and Targeted Changes T1: Account in a Financial Institution [Banks, NBFIs, MFIs, Insurance Companies]29%41%[14%]55% [12%]65% [18%]75% [18%]85% [15%]100%[17%]In 3 [2014-2017] years BD attained 14% yearly average growth [which was 17% for India]; rural expansion of banking [agent plus booth banking]; and expansion of Insurance and MFIs would contribute. Adults to Include for Attaining 100% Account Target with FIs 6.8 cr5.2 cr4.0 cr3 crore1.8 cr0Considering number of adults above 15 of 11.4 crore [72.2%] in 2017; and population growth of 1.04% [ HYPERLINK "" \l "Demographics" indexmundi data]T2: Accounts with Financial Institutions belonging to Poor below 40%22%33.0%[17%]50% [17%]60%[20%]70%[20%]85%[21%]100%[21%]In 3 [2014-2017] years BD attained around 17% yearly average growth [which was 26% for India]; rural expansion of banking [agent plus booth banking]; designing appropriate products, expansion of Insurance and MFIs. T3: Women having Account with Financial Institutions 25%32%[9.5%]40%[9%]50%[25%]60%[25%]80%[33%]100%[33%]During 2014-2017, BD attained around 9.5% yearly growth [which was 26% for India]; women friendly products; rural expansion of banking [agent plus booth banking]; and MFIs would contribute. T4: Young Adults with accounts in Financial Institutions [15-24]18%29.0%[20%]45%[19%]55%[22%]70%[27%]85%[22%]100%[22%]During 2014-2017, BD attained over 20% yearly growth [which was 22% for India]; appropriate products; and expansion of banking [agent plus booth] would contribute. T5: Adults with Account in Financial Institutions Living in Rural Areas28%40.0%[14%]55%[13%]65%[19%]75%[19%]85%[16]100%[17%]In 3 [2014-2017] years BD attained over 14% yearly growth [which was over 17% for India]; rural expansion of banking [agent plus booth banking]; Insurance and MFIs would contribute. Targets20142017 [Benchmark] Yearly Growth [2014-17] 2020[Target & Yearly Required Growth]2021[Target & Yearly Required Growth]2022[Target & Yearly Required Growth]2023[Target & Yearly Required Growth]2024[Target & Yearly Required Growth]Basis for Determining Benchmark and Targeted Changes T6: Adults Saved in Financial Institutions [Past Year]7%10%[14%]14%[14%]17%[21%]20%[22%]25%[25%]30%[25%]In 3 [2014-2017] years BD attained over 14% yearly growth [which for India also 14%; in developing countries 30% is a very good number; and in developed countries that commonly range from 40 to 75%]; rural expansion of banking [agent plus booth banking]; and MFIs would contribute. T7: Adults Availed Credit from FIs [Past Year] 10%9%[10%]10%[11%]11%[10%]12%[10%]13%[10%]15%[13%]In the World, 11% had credit from FIs in 2017; for middle income the figure was 11% and for high income it was 19% in 2017; the countries with 100% inclusion (developed) were having adults with generally 18% to 25% credit from FIs [with the exception of a few with 30 or close like USA, Canada] T8: Mobile Account Holders of the Total Adults 3%21%[200%]40%[30%]50%[25%]60%[25%]70%[17%]80%[17%]In 3 [2014-2017] years, BD attained remarkable success with over 200% yearly growth; such trends are visible mainly in some African countries [in Kenya 73% adults were having mobile accounts, the best in this category]; extensive mobile use and supportive policy would contributeT9: Adults made or received Domestic Remittance [past year]19%29%[20%]40%[13%]47%[19%]55%[19%]65%[19%]75%[19%]During 2014-2017, BD attained with over 20% yearly growth; extensive development in developing especially Latin American and African countries [in Kenya around 68% in 2017] using digital modesTargets20142017 [Benchmark] Yearly Growth [2014-17] 2020[Target & Yearly Required Growth]2021[Target & Yearly Required Growth]2022[Target & Yearly Required Growth]2023[Target & Yearly Required Growth]2024[Target & Yearly Required Growth]Basis for Determining Benchmark and Targeted Changes T10: Adults made or received Domestic Remittance Past Year [Rural]18%29%[20%]40%[13%]47%[13%]55%[13%]65%[13%]75%[13%]In 3 [2014-2017] years, BD attained over 20% yearly growth rate; extensive development in Latin America and Africa [in Kenya around 66% in 2017]. T11: Adults made or received Domestic Remittance Past Year [Bellow 40% ]13%22%[23%]30%[13%]36%[20%]42%[21%]50%[20%]60%[22%]In 3 [2014-2017] years, BD attained over 23% yearly growth; extensive development in Latin American and African countries [in Kenya around 55% in 2017] using digital modesT12: Adults made or received Domestic Remittance Past Year [Female ]16%25%[19%]35%[14%]40%[14%]45%[15%]52%[15%]60%[17%]In 3 [2014-2017] years, BD attained close to 19% yearly growth extensive development in Latin American and African countries [in Kenya 69% sent or receive remittances in 2017] using digital modes2020[Benchmark]20222024Basis for Determining Benchmark and Targeted Changes T13: CMSMEs having Account Relationship with Financial InstitutionsTo be Identified Consistent Improvement Consistent Improvement A Survey should be conducted by the Secretariat to Identify Benchmark by 2020; and targeted changes with the broad objective of Consistent Growth T14: Quality of Services in the Financial SectorTo be IdentifiedConsistent Improvement Consistent Improvement T15: Financial Market Development: Bond, Venture Capital Fund, Cooperatives To be IdentifiedConsistent Improvement Consistent Improvement 4.2: Monitoring and Evaluation (M&E) SystemThe Monitoring and Evaluation (M&E) system will generate timely feedback for use by the stakeholders to evaluate the extent and the nature of the development to measure success relative to the set targets and to provide values for understanding the success of the efforts and to suggest mid-term corrections to reach the targets. The NFIS-B Steering Committee (NSC) will develop implementation plans for strategic areas relating to their respective core objectives, and will closely monitor key initiatives undertaken by each of the Thematic Working Groups on a quarterly basis. NFIS-B National Secretariat will track the overall performance indicators and targets and report to the NSC on an annual basis to ensure that efforts are in line with the agreed targets. The tracking process will include: continuous monitoring the progress to achieve targets of financial inclusion; intermediate (midterm) evaluation to review the targets; and end-term evaluation (annually or more) to review the strategy. 4.2.1: Indicators to Measure NFIS-B Implementation Financial inclusion is commonly measured in three dimensions: access to financial services; usage of financial services; and quality of the products and service delivery mechanism (figure 4.1). Access to financial products and services basically indicates the ability to use available financial services and products from formal institutions; and according to AFI (2017) a basic proxy for access can be counting the number of accounts open across financial institutions and estimating the proportion of the population with an account. Eligibility and nearness are two important criteria to evaluate access. Usage of financial products and services reflect the frequency, extent and duration of usage over time. The usage indicators take count of ownership of accounts with financial institutions; accounts by the vulnerable groups; and digital accounts. Quality of financial products and services reveal how relevant a financial service or product is to customers. Quality issues are associated with costs of the services, barriers, financial literacy, and consumer protections. Both supply-side and demand-side data will be needed to form a comprehensive understanding on success, usage, and quality. Figure 4.1: Dimensions of Financial Inclusion Indicators361759513335Quality Quality 9906013970AccessAccess192913044450UsageUsageBroader financial inclusion is expected to contribute to more stable national financial systems as benefits and risks are shared more evenly across the population and financial segments. Bangladesh is a bank based system where insurance and capital market (securities and bond market) are yet to reach to the desired level of maturity. Insurance market is expanding rapidly in the emerging economies that attained reasonable high growth rates during 2010-2017. India has a dynamic micro-insurance (a key area for addressing financial inclusion) market that might offer valuable lessons. Especially, Bangladesh requires initiatives to improve growth in gross premium, delivery mechanism, insurance claim settlement; and popularizing targeted health, crop, livestock, and weather insurance products. Bringing capital market in the fold of financial inclusion drives primarily means involvement of the low-income people as promoters or owners of businesses. To reach such a level of offering especially-designed products, the country has to drive for an improved and matured capital market. It is however very inspiring to have recognized MFIs and fast moving mobile payment market in the country to explore. The M&E framework used a mix of World Bank Findex Indicators; IMF FAS Indicators; Global Partnership for Financial Inclusion (GPFI) indicators; AFI Core Set of Indicators; BIS Financial Inclusion Indicators; and G-20 Financial Inclusion Indicators to measure the status and progress of the financial inclusion in the country. To attain the 15 broad targets a total number of 50 indicators are identified as part of evaluation and monitoring framework [Table 4.2]. Table 4.2: Indicators for M & E System Targets IndicatorsMeasuring FrequencyData Source T1, T2, T3, T4, T5A1: Percentage of adults with Accounts at Financial Institution (Banks, NBFIs, MFIs, Insurance)Bi-Annually Financial Service Providers through concerned Departments of BB, MRA & IDRAA2: Percentage of adults Female with Account at Financial InstitutionsA3: Percentage of Youth (15-24) with Accounts at Financial InstitutionA4: Percentage of adults (of poor below 40%) with Accounts at Financial InstitutionA5: Percentage of Rural Adult with Accounts at Financial InstitutionA6: Percentage of Adult Insurance Policy Holders with Insurance CompaniesT6, T7, T13B1: Percentage of Adult Saved with Financial Institutions Annually Financial Service Providers through concerned Departments of BB, MRA & IDRAB2: Percentage of Adult Borrowed from Financial Institutions B3: Percentage of Household having Account with Financial InstitutionsB4: Percentage of Adults Saved with MFIsB5: Percentage of Adults Borrowed from MFIsB6: Percentage of Household having Account Relationship with MFIsB7: Percentage of Adult Holding Insurance PoliciesB8: Percentage of CMSMEs having Account in the Financial InstitutionsB9: Percentage of CMSMEs with Loan Accounts at Financial InstitutionsT8, T9, T10, T11, T12C1: Percentage of Adult having Mobile AccountAnnually Financial Service Providers through concerned Departments of BB, BD Postal Authority C2: Percentage of Adults Having Agent Banking AccountsC3: Percentage of Adult Availed Digital Post Office Services C4: Percentage of Adults Made or Received Domestic Remittance C5: Percentage of Adults Made or Received Domestic Remittance [Rural]C6: Percentage of Adults Made or Received Domestic Remittance [Female]C7: Percentage of Adults Made or Received Domestic Remittance (Below 40% Poor)T14 D1: Volume of Agricultural [Farm] Financing (% of Total) by Financial Institutions Once in Two YearsBenchmark Survey & Progress Study with Supply and Demand Side in association with concerned Departments of BB,MRA, BSEC, IDRA, Department of CooperativesD2: Volume of CMSME Financing [% of Total] by Financial InstitutionsD3: Volume of Agricultural (Farm) Financing [% of Total] by Financial InstitutionsD4: Volume of Women Owned CMSME Financing (% of Total) by Financial InstitutionsD5:Volume of Green Financing (% of Total) by Financial InstitutionsD6: Number of Small Policy holders (Micro Insurance] per 1000D7: Proportion of Youth, Third Gender, and Physically Challenged People of the included Population with Financial Institutions and MFSD8: Average Cost of Maintaining an Account in Financial InstitutionsD9: Average Cost of Fund Transfer in Financial InstitutionsD10: Average Cost in Mobile or Digital Fund TransferD11: Percentage of CMSMEs required to provide Collateral on the Loans from Financial Institutions D13: Percentage of Agricultural [Farm] Borrowers required Collateral in their Loans from Financial InstitutionsD14: Fund Spent on Financial & Digital Literacy by Financial InstitutionsD15: Percentage of NPL in CMSMEs, Agriculture and Green CreditD16: Installing and Addressing Consumer Protection and TransparencyD17: Interoperability of MFS, Banks and MFIsD18: Number of Bank Branches per 100,000 adultsD19: Number of MFI Branches per 100,000 adultsD20: Number of Insurance Centres per 100,000 adultsD21: Number of Bank Branches per 100,000 adultsD22: Agent Banking/Booth Banking Units in Unions/Villages D23: Number of ATMs per 100,000 AdultsD24: Number of POS Terminals per 100,000 AdultsT15 E1: Bond Market DevelopmentOnce in Two YearsBenchmark Survey & Progress Study with Supply and Demand Side in association with concerned Departments of BB,MRA, BSEC, IDRA, Department of CooperativesE2: Development of Micro insurance & BancansuranceE3: Venture Capital Market DevelopmentE4: Cooperatives Market Development4.2.2: Mid Term and End Term Tracking and Evaluation for M & ENational Secretariat will be responsible for Semi-Annual, Annual and Two-yearly evaluation. Data will be gathered on all the 50 indicators (table 4.2); however, the format for Bi-Annual Evaluation will indicate overall status related to targets T1, T2, T3, T4 and T5 for future course of action (Table 4.3). Table 4.3: Semi-Annual Evaluation Format[Targets T1-T5]In line with the Target Right Track Over 75% of the Target Slow Track Over 50% of the Target Very Slow Tract Below 50% of the Target Track Adjustment Required The tracked/monitored outcome will be evaluated annually with the NFIS-B Steering Committee (NSC) and the NFIS-B Advocacy Committee (NAC) for target adjustment. Format for Annual evaluation will indicate overall status for future course of action related to targets T1-T13 (Table 4.4). Table 4.4: Annual Evaluation Format [Targets T1-T13]In line with the Target AchievedOver 75% of the Target Partially Achieved Over 50% of the Target Partially Achieved-Partial Target Adjustment Below 50% of the Target Target Adjustment Required The National Secretariat will have a Two-Yearly Evaluation [2022 & 2024] with NSC, NAC, and the NFIS-B National Council (NNC) covering all indicators [A,B,C,D,E], and the broad targets (T1-T15). The format (Table 4.5) indicates the performance related to these key 15 targets. For the targets T14 and T15, the secretariat needs to conduct surveys/studies for identifying benchmarks and expected changes by 2022 and 2024; and the actual changes as well. The Secretariat will also be responsible to identify overall achievement using an Integrated Index (Table 4.6). Table 4.5: Two-Yearly Evaluation Format [Targets T1-T15]In line with the Target AchievedOver 75% of the Target Partially Achieved Over 50% of the Target Partially Achieved-Partial Target Adjustment Below 50% of the Target Target Adjustment Required 4.2.3: Integrated Index to Indicate Overall Status of Financial Inclusion All the financial indicators are not equally attainable; and the outcomes of different inclusion indicators do not imply the same level of success or failure on the financial inclusion drives. Moreover, the range of values may also be different for different indicators. Thus an integrated index covering access; usage and quality may indicate the overall inclusion improvement or changes over the targeted period. Secretariat will prepare the Index Sheet based on Two-Yearly Evaluation in 2022 and 2024. Access issues are allocated maximum weight of 50% and remaining 50% are assigned for usage and quality issues (Table 4.6). Based on the achievement of the broad targets (25%, 50%, 75% and 100%) specific scores would be allocated and summed up (Table 4.7) to obtain integrated score that might maximum be 1 (one). Table 4.6: Integrated Weighted Average Index of Financial Inclusion Broad Targets WeightScore25% & AboveScore50% & AboveScore75% & AboveScore 100% & AboveT1: Account in a Financial Institution [Banks, NBFIs, MFIs, Insurance Companies]0.500.1250.250.3750.50T2: Accounts with Financial Institutions belonging to Poor below 40%0.250.0150.0310.0470.0625T3: Women having Account with Financial Institutions0.0150.0310.0470.0625T4: Young Adults with accounts in Financial Institutions [15-24]0.0150.0310.0470.0625T5: Adults with Account in Financial Institutions Living in Rural Areas0.0150.0310.0470.0625T6: Adults Saved in Financial Institutions [Past Year]0.250.006250.01250.0190.025T7: Adults Availed Credit from FIs [Past Year]0.006250.01250.0190.025T8: Mobile Account Holders of the Total Adults0.006250.01250.0190.025T9: Adults made or received Domestic Remittance [past year]0.006250.01250.0190.025T10: Adults made or received Domestic Remittance Past Year [Rural]0.006250.01250.0190.025T11: Adults made or received Domestic Remittance Past Year [Bellow 40% ]0.006250.01250.0190.025T12: Adults made or received Domestic Remittance Past Year [Female ]0.006250.01250.0190.025T13: CMSMEs having Account Relationship with Financial Institutions0.006250.01250.0190.025T14: Quality of Services in the Financial Sector0.006250.01250.0190.025T15: Financial Market Development: Bond, Venture Capital Fund, Cooperatives0.006250.01250.0190.025Table 4.7: Integrated Score of the Index and InterpretationsScoreInterpretation1.00Achieved 0.75 and Above Partial Achievement 0.50 and Above Low Achievement 0.25 and Above Insignificant Achievement Below 0.25No Achievement 4.3: Data Mapping and Reporting for Operationalising M&E Framework The data and information collected from various sources must be unified and transformed into a format suitable for summarizing and analysing. This is accomplished through data mapping, which is an integral step in M & E processes where National Secretariat will be the Data Destination Centre (DDC) as part of its Medium Term, and Long Term Tracking/evaluation of NFIS-B, for maintaining MIS, and for preparing M&E reports. Figure 4.2: Data Collection Mapping and Involvement of Agencies-9525276860Data Destination Centre [National Secretariat]00Data Destination Centre [National Secretariat]137668025908005766575805003838832116995Data Related to Access and Usage of Services by Services by Bank and NBFI00Data Related to Access and Usage of Services by Services by Bank and NBFI1713470158904Reporting through BBReporting through BB1442720812800384238582550Data Related to Access and Usage of Mobile & Agent Banking Services 00Data Related to Access and Usage of Mobile & Agent Banking Services 1795145100965Reporting through BB0Reporting through BB149733015875003838575101600Data Related to Access and Usage of Services by MFIs’ Services 00Data Related to Access and Usage of Services by MFIs’ Services 1795145-1270Reporting through MRA0Reporting through MRA3838575130175Data Related to Access and Usage of Services by Insurance Services 00Data Related to Access and Usage of Services by Insurance Services 1376680311150171577013970Reporting through IDRAReporting through IDRA1061720222250383857522225Data Related to Access and Usage of Other Services Postal Services etc 00Data Related to Access and Usage of Other Services Postal Services etc 14097008890Reporting through Govt. Agencies0Reporting through Govt. Agencies57150167005001171574146050Demand and Supply-Side Surveys/Studies [annually and once in two years] will be coordinated by the National Secretariat in association (by engaging professionals) with the concerned regulatory agencies (Departments of BB, MRA, IDRA, BTRC, BSEC) Insurance Companies00Demand and Supply-Side Surveys/Studies [annually and once in two years] will be coordinated by the National Secretariat in association (by engaging professionals) with the concerned regulatory agencies (Departments of BB, MRA, IDRA, BTRC, BSEC) Insurance Companies5NFIS-B Progress Report5.1 NFIS-B Review Intervals and ReportsNFIS-B progress report reviewing is an important element of the implementation process. Stakeholders and the public benefit from understanding that the NFIS-B is being implemented with quality in a timely manner; what actions are linked to it; what successes have been achieved; and what challenges remain. The approach helps to ensure broad-based support and buy-in for the NFIS-B. In this context, some countries develop an NFIS communication strategy, including sponsored events, publications like newsletters, press releases, “branding,” websites, and public reports as well as periodic internal reports. Internal and public reports are two important approaches to communicate NFIS-B progress. Based on global best practices, it is suggested that for NFIS-B, there should be: (i) a frequent (e.g. quarterly) internal progress report; and (ii) an annual report. Periodic reporting may include both external and internal publications, such as an external newsletter to highlight NFIS-B successes and a separate, internal progress report to monitor actions and identify bottlenecks. Further, internal progress reports should often include action-level progress, and gaps. It is important to standardise the periodic reporting to monitor progress more effectively over time. 5.2 Structure of Periodic Internal ReportsThe periodic internal progress reports will show the successes and identify bottlenecks or slowed actions, which, in effect, will allow stakeholders (including Implementation committees) to respond quickly to bottlenecks and provide policy guidance as needed, including by appropriately reallocating funds or other resources.For getting a comprehensive picture of NFIS-B progress and to get easy comparisons with past reports over time, a periodic interval reporting template should contain the following elements: Figure 5.1: Elements of periodic internal reports5.3 Structure of Annual Report The annual report will provide a comprehensive overview and analysis of NFIS-B progress by sector, including action-level achievements and progress. An annual report will be developed every year and it will be written to follow the NFIS-B framework, or divided by working groups to more easily map progress and constraints. However, to develop an annual report structure, the following sections should be considered:i. Executive summaryii. Financial inclusion landscapeiii. Recent macroeconomic developments in the financial sectoriv. Overview of the current access and usage of financial servicesv. Comprehensive overview of NFIS action achievements and progress towards NFIS targetsvi. Sector- or theme-specific overviews, as relevant to recent market developmentsvii. NFIS-B priorities for the following yearAs the key implementing agency of NFIS-B will be the Bangladesh Bank (BB), it will prepare a time bound target wise action plan based on the vision, core dimensions, objectives, strategic goals and targets of this strategy along with a monitoring and evaluation (M&E) framework which will be placed in the first meeting of NFIS-B National Secretariat (NNS) for approval. The NNS will work as the statistical agency for financial inclusion in Bangladesh. NNS will collect data, maintain MIS and prepare M&E reports for NNC, NSC and NAC as well as relevant government agencies. The M&E reporting system will cover the following: NNS will send progress report of this strategy to the Minister, Ministry of Finance through FID, MOF on a quarterly basis. The reports have to be placed before the Finance Minister within 30 days after the end of each quarter. The first report will be submitted at the end of the first quarter of 2020.NNS will submit the progress report of this strategy to the Governor, Bangladesh Bank on a monthly basis. The reports have to be placed to the Governor within 10 days after the end of each month. First report will be submitted at the end of first month (January) of 2020.NNS will submit the progress report of this strategy to the Cabinet on a bi-annual basis. The reports will have to be placed to the Cabinet within 45 days after the end of each six month. First report will be submitted at the end of first six months of 2020.NNS will upload the monthly progress reports in the website of NFIS-B within 15 days after the end of each month. 6NFIS-B Implementation and Resource Plan6.1 NFIS-B Implementation and Resource PlanThe success of implementation of NFIS-B will depend on adoption of sound financing strategy for which a balanced mapping between and among public finances, private finance and development assistance will be critical. Besides, the success also depends on the financial service providers (FSPs) who will be the key actors in implementing the strategy. For effective implementation, an important pre-requisite is to estimate programme costs and develop a resource plan including identifying the potential sources of fund and estimating the total resources required by different government and private sector agencies to implement the NFIS-B. For the purpose, this section provides the resource plan covering: Estimates of the total resources required by different government agencies and private sector to implement the NFIS-B along with indication of the sources of funds;Year-wise resource requirements for government agencies, regulators and private sector to implement NFIS-B Action Plan, 2020-2024; andSources of resources such as budget allocation from GOB, private sectors and grant or loan fund from development partners.The resource plan considers three potential sources of financing: GOB (public sector), private sector, and external sources comprising foreign aid and grants. 6.2 Estimated Resource Envelope for NFIS-BFor implementing NFIS-B, the public sector investment comprises investment components of the annual development programme (ADP), capital expenditure components of the revenue budget, and own investments. A major part of the ADP will be financed from the domestic resources comprising fiscal savings/revenue surpluses and borrowing from the banking/other sources. However, the private sector will be the main agent and will play an important role towards achieving the goals and targets of NFIS-B.Historically, the private sector has been playing an important role in Bangladesh’s development. Both commercial banks and development financial institutions (DFIs) are involved in providing both short and long term credit to finance private investment. NFIS-B has set 12 goals and 65 targets. The activities for achieving the goals and targets of NFIS-B would be implemented mostly by the private sector in collaboration with the public sector, NGO-MFIs and other institutions. External resource requirements for implementing NFIS-B have been estimated as the residual, that is the difference between the estimated requirements and projected availability from public and private sectors. External financing comprises foreign aid and grants from bilateral sources as well as resource flows from multilateral and other financial institutions. 6.2.1 Total Resource RequirementsTotal resource requirements have been estimated through detailed discussions with all relevant stakeholders, especially those who will be involved in actual implementation of NFIS-B including regulatory authorities, concerned ministries and agencies, banks and other financial institutions, NGO-MFIs, insurance companies & associations, trade bodies & associations, post office, cooperatives and other potential organisations. Similarly, year wise financial resource needs for all concerned stakeholders have been estimated according to our required format for each goal and target separately. Table 6.1 gives the total additional resource requirements for major stakeholders; while Table 6.2 shows the probable yearly allocations in terms of potential sources including public and private sectors as well as the development partners. It may be mentioned here that the overall cost structure for achieving the NFIS-B goals and targets (which are so varied along with concrete progress needed in specific targets) may appear to be on the downside. But, the cost estimates presented in this document have been arrived at taking into account the additional expenditures earmarked by the government for meeting the SDGs, many of which also promote financial inclusion as a pre-condition for achieving the SDGs. The estimates take into account all such complementarities to avoid ‘double counting’ and not to unduly inflate the fiscal burden of the government. In this respect, some examples of compatibility analysis conducted under the present study with the SDGs and NFIS-B are given in Annexure 8. In addition, while calculating additional NFIS-B resource cost, implementation cost of each activity has been considered explicitly along with assuming follow up activities after implementation will be transferred to the regular budget of each institution. During the five year period of 2020-2014, the total additional requirement is estimated at BDT 573,831 million at constant 2018/19 prices. The goal and target wise resource requirements for all sectors are summarised in Annexure 9.Table 6.1: Additional resource requirements(in million BDT at constant 2018/19 prices)Stakeholders20202021202220232024TotalBanks and NBFIs8,45510,45510,40011,05020,00060,360MFS providers and Fintechs4,9026,0297,0207,76114,08839,800NGO-MFIs6,68315,02015,00018,00032,00086,703Insurance Companies1753756508501,6503,700Government agencies 40,71580,77579,52978,300103,949383,268Total 60,930112,654112,599115,961171,687573,831Table 6.2: Suggested potential source of resources (in million BDT at constant 2018/19 prices)?Sector20202021202220232024TotalPrivate sector* (own source)/Internal fund7,31213,51813,51215,07525,75368,860Government budget allocation 27,41950,69450,67051,02377,259258,224Development partners 21,32639,42939,41040,58660,090200,841Foreign private sector borrowings/Investment/Equity4,8749,0129,0089,2778,58445,906Total 60,930112,654112,599115,961171,687573,831*Private sector includes banks, NBFIs, MFS providers, Fintechs, MFIs, insurance companies, venture capital investment companies, and other potential private institutions. AnnexuresAnnexure 1: Terms of Reference for the NFIS-B National Council (NNC)PurposeNFIS-B National Council (NNC) is the supreme strategic authority for implementation of NFIS and moving the national agenda for financial inclusion in Bangladesh. The NNC provides the vision, strategic direction and required guidance and oversight in implementing the financial inclusion agenda. BackgroundAccess to finance for the poor is essential to promote inclusive economic growth and to eradicate poverty in the country. A developed inclusive financial system not only expedites the process of resource mobilization and use, it also provides financial services to all who need them. It creates employment opportunities, ensures economic and financial stability through reducing vulnerability, and contributes to poverty reduction. As a policy, financial inclusion is recognised to have significant potential for improving the well-being for all, and especially for the participants in unserved and under-served financial markets who belong to the poor and marginalized groups; CMSMEs; small and marginal farm households; participants in informal sector activities; youth and women belonging to poor households; indigenous people; persons with disabilities; and other disadvantaged groups.In recognition of this the People’s Republic of Bangladesh has developed and approved the National Financial Inclusion Strategy of Bangladesh 2020 – 2024 (NFIS-B) during 2019. The Strategy lays out the priorities to be pursued in the area of financial inclusion over the next five years, under the able leadership of the Ministry of Finance and the Bangladesh Bank.Financial inclusion is an inter-ministerial and multi stakeholder process, and thus there is a need for overall coordination at National level. The NFIS-B National Committee has been formed to provide overall leadership in the implementation of the NFIS-B, and under the leadership of the Minister of Finance will provide the direction and resources needed to achieve the objectives.MandateThe Terms of Reference (ToR) of NNC will be as follows (but not limited to):Approve a time bound target wise action plan based on the vision, core dimensions, objectives, strategic goals and targets of the NFIS-B and review that plan annually.Approve the financing strategy for implementing NFIS-B and provide directives to concerned agencies for allocation of resources.Approve the Monitoring and Evaluation (M&E) framework of NFIS-B.Approve a set of globally comparable national financial inclusion indicators as part of the M&E frameworkReview the NFIS-B every two years, and approve any modification, if needed.Evaluate the progress of implementation of the NFIS-B on an annual basis.Provide guidance and leadership in policy, institutional, legal and other reforms necessary to realize the financial inclusion objectives and goals.Approve appropriate coordination mechanisms at all levels and provide guidance for aligning the financial inclusion process with other processes.Approve any change(s) in the formation of NFIS-B Steering Committee (NSC) and NFIS-B Advocacy Committee (NAC).Conduct meetings of the NNC at least one time a year.Perform any other function as needed to achieve the financial inclusion goals including advising the Government on the best way ernanceThe NNC will be convened under Chairmanship of the Minister in the Ministry of Finance, whereas the Deputy Governor of Bangladesh Bank supported by the Executive Director responsible for the NFIS-B Secretariat will serve as the secretary to provide coordination oversight and support to the chair. The chair may form ad-hoc committees/task-forces, composed of representatives from relevant stakeholders, to provide critical recommendations and support on priority financial inclusion initiatives, such as enabling regulations, financial education, payments systems, etc. MembersThe NNC will be an inclusive platform for coordination and learning across ministries, and membership is limited to senior representatives in ministries and agencies engaged in providing or enabling financial services in the country. Each institution may appoint one senior officer and their alternate to be its representative, and the nominees should have authority needed to take key decisions in their relevant Ministries or Agencies.Guests and other participants may be invited to the Committee’s sessions for specific discussions, and these may include government ministries, sector experts, new market entrants or other players who may bring relevant information, experience or insight. The structure of the NNC will be as follows:Minister, Ministry of Finance- ChairMinister, Ministry of Planning-MemberMinister, Ministry of Law-MemberMinister, Ministry of Agriculture-MemberMinister, Ministry of Women & Children Affairs-MemberMinister, Ministry of Commerce-MemberMinister, Ministry of Industry-MemberMinister, Ministry of Social Welfare-MemberMinister, Ministry of LGRD and Co-operatives-MemberMinister, Ministry of Labor and Employment-MemberMinister, Ministry of Post and Telecommunications-MemberMinister, Ministry of Primary & Mass Education-MemberMinister, Ministry of Education-MemberState Minister, ICT Division-MemberPrinciple Secretary to Honorable Prime Minister-MemberChief Coordinator on SDGs Affairs of Prime Minister’s Office-MemberGovernor, Bangladesh Bank-MemberSecretary, Financial Institutions Division, Ministry of Finance-MemberChairman, Association of Bankers Bangladesh-MemberChairman, Bangladesh Leasing and Finance Companies Association-MemberPresident, Federation of Bangladesh Chambers of Commerce& Industries-MemberPresident, Bangladesh Insurance Association-MemberPresident, Bangladesh Merchant Bankers Association-MemberRepresentative from Credit Development Forum-MemberPresident, Bangladesh Women Chamber of Commerce and Industry-MemberPresident, Association of Mobile Telecom Operators of Bangladesh -MemberRepresentative from MFS Operators-MemberChairman, Bangladesh Association of Software and Information-MemberRepresentative, Local Consultative Group in Bangladesh-MemberDirector General, Bangladesh Institute of Development Studies-MemberDirector General, Bangladesh Institute of Bank Management-MemberExecutive President, Bangladesh Institution of Capital Market -MemberDirector General, Bangladesh Academy for Securities Markets (BASM) -MemberDirector, Bangladesh Insurance Academy-MemberExecutive Director, Institute for Inclusive Finance and Development -MemberDeputy Governor, Bangladesh Bank -Member Secretary* The chair may decide to increase or decrease the size of the committee based on strategic needs.** The ministries which do not have appointed Minister, State Minister or Deputy Minister will be the member from those ministries upon the decision taken by the Chair.Meeting ScheduleThe National Committee will be convened at least twice every year. However, additional meetings can be called by the chair as needed to achieve its overall objectives. Follow-up of decisions and actions agreed during the meetings will be the responsibility of NFIS-B Secretariat. Agenda, minutes of the meetings, accompanying documents and presentations will be managed and shared by the Secretariat.LocationThe Committee will convene at a location as determined by the Chairperson.ApprovalThis terms of Reference is approved by the Prime Minister’s Office, People's Republic of Bangladesh.Annexure 2: Terms of Reference for the NFIS-B Steering Committee (NSC)PurposeThe NFIS-B Steering Committee (NSC) has the overall responsibility of implementing the NFIS- B under the guidance of the NNC. The NSC is responsible for ensuring coordination, effectiveness and quality control in all activities under the financial inclusion agenda. BackgroundAccess to finance for the poor is essential to promote inclusive economic growth and to eradicate poverty in the country. A developed inclusive financial system not only expedites the process of resource mobilization and use, it also provides financial services to all who need them. It creates employment opportunities, ensures economic and financial stability through reducing vulnerability, and contributes to poverty reduction. As a policy, financial inclusion is recognized to have significant potential for improving the well-being for all, and especially for the participants in unserved and under-served financial markets who belong to the poor and marginalized groups; CMSMEs; small and marginal farm households; participants in informal sector activities; youth and women belonging to poor households; indigenous people; persons with disabilities; and other disadvantaged groups.In recognition of this the People’s Republic of Bangladesh has developed and approved the National Financial Inclusion Strategy of Bangladesh 2020 – 2024 (NFIS-B) during 2019. The Strategy lays out the priorities to be pursued in the area of financial inclusion over the next five years, under the able leadership of the Ministry of Finance and the Bangladesh Bank.Financial inclusion is an inter-ministerial and multi stakeholder process, and thus there is a need for overall coordination at National level. The NFIS-B National Committee has been formed to provide overall leadership in the implementation of the NFIS-B. The NFIS-B Steering Committee will support the National Council in providing technical leadership, and coordination oversight.MandateThe Terms of Reference (ToR) of NSC will be as follows (but not limited to):Ensure coordination and timely undertaking of the activities of NFIS-B by all stakeholders, regularly reviewing progress of implementation, and suggesting ways to overcome critical obstacles and exploit opportunities;Provide technical leadership to stakeholders, to ensure that synergies are exploited, innovation is embraced and exploited, and that activities are suitably coordinated;Engage with stakeholders to catalyse and actualise the public private partnerships to move financial inclusion forward in Bangladesh, and identify important areas for engagement with donor partners;Ensure that a properly functional NFIS-B National Secretariat is in place with capacity to efficiently perform its roles and responsibilities;Oversee the NFIS-B Secretariat (from a technical perspective in its support to various coordination bodies), providing any necessary guidance on issues related to financial inclusion to ensure the support provided is world class and takes into account the national context.Suggest modalities for inter- and intra-institutional collaboration and cooperation in both public and private sectors;Indicate priorities and guidelines for preparing detailed action plan and required resources for implementing the financial inclusion agenda;Review progress of implementation biannually and finalize recommendations for consideration of the NNC;Create awareness and support for the NFIS-B and NFIS-B Implementation, through various local and international forums;Conduct meeting of the NSC at least two times a year; andPerform any other function as guided by the ernanceThe NSC will be convened under Chairmanship of the Governor of the Bank of Bangladesh, whereas the Executive Director responsible for the NFIS-B Secretariat within the Bangladesh Bank will serve as the secretary and provide coordination oversight and support to the chair. The chair may form ad-hoc committees/task-forces, composed of representatives from relevant stakeholders, to provide critical recommendations and support on priority financial inclusion initiatives. MembersThe NSC will be an inclusive platform for coordination and learning across ministries and agencies, and membership is limited to senior level government officials with direct responsibility at executive level for implementing or enabling financial services in the country. Each institution may appoint one senior officer and their alternate to be its representative, and the nominees should have authority needed to take key decisions in their relevant Ministries or Agencies.Guests and other participants may be invited to the Committee’s sessions for specific discussions, and these may include government ministries, sector experts, new market entrants or other players who may bring relevant information, experience or insight. The structure of the NSC will be as follows:Governor, Bangladesh Bank- ChairSecretary, Finance Division, Ministry of Finance-MemberSecretary, Financial Institutions Division, Ministry of Finance-MemberSecretary, Internal Resources Division, Ministry of Finance-MemberMember, General Economic Division, Ministry of Planning-MemberSecretary, Ministry of Agriculture-MemberSecretary, Ministry of Women & Children Affairs-MemberSecretary, Ministry of Commerce-MemberSecretary, Ministry of Industry-MemberSecretary, Ministry of Social Welfare-MemberSecretary, Ministry of Labor and Employment-MemberSecretary, ICT Division, Ministry of Post and Telecommunications-MemberSecretary, PTD, Ministry of Post and Telecommunications-MemberSecretary, Ministry of Primary & Mass Education-MemberSecretary, Secondary and Higher Education Division, Ministry of Education -MemberSecretary, Prime Minister’s Office-MemberChairman, Insurance Development and Regulatory Authority-MemberChairman, Bangladesh Securities and Exchange Commission-MemberExecutive Vice Chairman, Microcredit Regulatory Authority-MemberChairman, Bangladesh Telecommunication Regulatory Commission-MemberController General of Accounts, Office of the Comptroller and Auditor General of Bangladesh-MemberDirector General, NIDW, Bangladesh Election Commission-MemberDirector General, Department of Cooperatives-MemberDirector General, Bangladesh Post Office-MemberHead of NFIS-B National Secretariat, -Member SecretaryMeeting ScheduleThe Committee will be convened at least twice every quarter. However, additional meetings can be called by the chair as needed to achieve its overall objectives. Follow-up of decisions and actions agreed during the meetings will be the responsibility of NFIS-B Secretariat. Agenda, minutes of the meetings, accompanying documents and presentations will be managed and shared by the Secretariat.LocationThe Committee will convene at a location as determined by the Chairperson.ApprovalThis terms of Reference is approved by the NFIS-B National Council, and any change(s) in the ToR or structure of NSC shall be approved by Chairman of the NNC.Annexure 3: Terms of Reference for the NFIS-B Advocacy Committee (NAC)PurposeThe NFIS-B Advocacy Committee (NAC) will be the platform for the public-private partnership and policy advocacy on financial inclusion at national level. The NAC will be the forum for having the recommendations from the practitioners, implementing partners, academia and the financial service providers. The NAC will be chaired by Secretary, Financial Institutions Division, Ministry of Finance. BackgroundAccess to finance for the poor is essential to promote inclusive economic growth and to eradicate poverty in the country. A developed inclusive financial system not only expedites the process of resource mobilization and use, it also provides financial services to all who need them. It creates employment opportunities, ensures economic and financial stability through reducing vulnerability, and contributes to poverty reduction. As a policy, financial inclusion is recognized to have significant potential for improving the well-being for all, and especially for the participants in unserved and under-served financial markets who belong to the poor and marginalized groups; CMSMEs; small and marginal farm households; participants in informal sector activities; youth and women belonging to poor households; indigenous people; persons with disabilities; and other disadvantaged groups.In recognition of this the People’s Republic of Bangladesh has developed and approved the National Financial Inclusion Strategy of Bangladesh 2020 – 2024 (NFIS-B) during 2019. The Strategy lays out the priorities to be pursued in the area of financial inclusion over the next five years, under the able leadership of the Ministry of Finance and the Bangladesh Bank.Financial inclusion is an inter-ministerial and multi stakeholder process, and thus there is a need for overall coordination at National level. The NFIS-B National Committee has been formed to provide overall leadership in the implementation of the NFIS-B, while the NFIS-B Steering Committee supports the National Council through technical leadership, and coordination oversight. The NAC will further support the NSC in this endeavour, by allowing the private sector a strong voice on the NFIS-B implementation process.MandateThe Terms of Reference (ToR) of NAC will be as follows (but not limited to):Enable the environment of policy dialogue within public sector and private sectorDevelop recommendations for NNC and NSC for informed policy decisionDisseminate strategic directions of NNC to key market playersConduct meeting of the NAC at least two times a year.Perform any other function as guided by the ernanceThe NAC will be chaired by the Secretary of the Financial Institutions Division, Ministry of Finance, whereas the NFIS-B Secretariat of the Bangladesh Bank will serve as the secretary and provide coordination oversight and support to the chair.The chair may form ad-hoc committees/task-forces, composed of representatives from relevant stakeholders, to provide critical recommendations and support on priority financial inclusion initiatives. MembersThe NAC will be an inclusive platform for coordination and learning across the private sector, and membership is limited to senior level officials with responsibility for implementing or enabling financial services in the country.Guests and other participants may be invited to the Committee’s sessions for specific discussions, and these may include sector experts, new market entrants or other players who may bring relevant information, experience or insight. The structure of the NSC will be as follows:Secretary, Financial Institutions Division, Ministry of Finance - ChairChairman, Association of Bankers Bangladesh -MemberChairman, Bangladesh Leasing and Finance Companies Association -MemberPresident, Federation of Bangladesh Chambers of Commerce & Industries -MemberPresident, Bangladesh Insurance Association -MemberPresident, Bangladesh Merchant Bankers Association -MemberRepresentative from Credit Development Forum -MemberPresident, Bangladesh Women Chamber of Commerce and Industry -MemberPresident, Association of Mobile Telecom Operators of Bangladesh -MemberRepresentative from MFS Operators -MemberChairman, Bangladesh Association of Software and Information -MemberRepresentative, Local Consultative Group in Bangladesh -MemberDirector General, Bangladesh Institute of Development Studies -MemberDirector General, Bangladesh Institute of Bank Management –MemberDirector, Bangladesh Insurance Academy -Member33Executive Director, Institute for Inclusive Finance and Development -MemberDeputy Head of NFIS-B National Secretariat -Member Secretary.Meeting ScheduleThe Committee will be convened at least twice a year. However, additional meetings can be called by the chair as needed to achieve its overall objectives. Follow-up of decisions and actions agreed during the meetings will be the responsibility of NFIS-B Secretariat. Agenda, minutes of the meetings, accompanying documents and presentations will be managed and shared by the Secretariat.LocationThe Committee will convene at a location as determined by the Chairperson.ApprovalThis terms of Reference is approved by the NFIS-B National Council, and any change(s) in the ToR or structure of NAC shall be approved by Chairman of the NNC.Annexure 4: Terms of Reference for the Thematic Working GroupsAnnexure 4.1: Financial Sector Deepening Working GroupPurposeThe NFIS-B Thematic Working Groups support the NSC to advance financial inclusion in specific technical areas at national level. The Working Groups will be a forum for having all stakeholders from the public, private and donor communities come together to make the recommendations to be considered by the NSC and / or the NAC.BackgroundAccess to finance for the poor is essential to promote inclusive economic growth and to eradicate poverty in the country. A developed inclusive financial system not only expedites the process of resource mobilization and use, it also provides financial services to all who need them. It creates employment opportunities, ensures economic and financial stability through reducing vulnerability, and contributes to poverty reduction. As a policy, financial inclusion is recognized to have significant potential for improving the well-being for all, and especially for the participants in unserved and under-served financial markets who belong to the poor and marginalized groups; CMSMEs; small and marginal farm households; participants in informal sector activities; youth and women belonging to poor households; indigenous people; persons with disabilities; and other disadvantaged groups.In recognition of this the People’s Republic of Bangladesh has developed and approved the National Financial Inclusion Strategy of Bangladesh 2020 – 2024 (NFIS-B) during 2019. The Strategy lays out the priorities to be pursued in the area of financial inclusion over the next five years, under the able leadership of the Ministry of Finance and the Bangladesh Bank.Financial inclusion is an inter-ministerial and multi stakeholder process, and thus there is a need for overall coordination at National level. The NFIS-B National Committee has been formed to provide overall leadership in the implementation of the NFIS-B, while the NFIS-B Steering Committee and NFIS-B Advocacy Committee support the National Council in coordinating stakeholders. The thematic Working Groups will further support the NFIS-B implementation process by providing deep technical knowhow and knowledge to the national committees. Five Working Groups have been formed:Financial Sector DeepeningDigital financial services.CMSME.Consumer empowerment and risk management Data and measurement MandateThe Government of Bangladesh recognizes that to be useful, financial services must reach all sectors of the economy. The financial deepening thematic working group will focus on strategies identified under the NFIS-B to extend reach and depth of the financial sector, as outlined in Goals 1, 5, 9 and 11 of the NFIS-B. Furthermore the working group will coordinate closely with the CMSME thematic working group for aspects related to the CMSMEs, ensuring that synergies are exploited. The primary objective of the Financial Sector Deepening (FSD) working committee is to bring together stakeholders in the related sectors to promote financial inclusion.The Terms of Reference (ToR) of the FSD Working Group will be as follows:Make recommendations and provide technical advice and leadership to the national implementation committees to ensure the successful implementation of issues under Goal 1 (financial deepening), Goal 5 (inclusion of Women, climate affected and other underserved segments), Goal 9 (Insurance) and Goal 11 (Micro insurance)Provide an appropriate forum for industry level dialogue where relevant stakeholders (government, businesses and donors) engage regularly to discuss FSD initiatives that will lead to greater financial inclusionIdentify constraints and opportunities related to the deployment and expansion of financial services in underserved segments of Bangladesh, especially in rural and remote areasPromote collaboration and partnerships among the different players for delivering financial services in a transparent, fair and safe mannerSupport the development of innovative models and solutions for widening the reach of formal financial services by serving as a platform for generating and sharing knowledgeSupport the NNS, NSC and the NAC with technical input to ensure appropriate decisions and resolutions in the area of ernanceThe FSD Working Group will be convened will be chaired by the Bangladesh Bank, whereas the NFIS-B Secretariat of the Bangladesh Bank will serve as secretary.MembersThe FSD Working group will be an inclusive platform for coordination and learning, and is open to the main stakeholders in the Government, Donor, NGO, and Financial Institutions sectors. Each institution may appoint one senior officer and their alternate to be its representative, and the nominees should have expertise and experience in their relevant field (including banking especially agent banking, microfinance, insurance, micro insurance, and distribution).The initial membership of the FSD Working Group is proposed as follows:BB – Financial Inclusion Department (Chair)NFIS Secretariat BB Sustainable FinanceMoF (FID)MRAIDRAPKSFNational association of microfinance in BangladeshCredit and Development Forum (CDF)Government agency for microfinance, PDBF Bangladesh Insurance AssociationKey ministries (MoAg, MSW, MoH, MoWCA, Ministry of Environment, Forest and Climate Change (MoEFCC), Ministry of Disaster Management and Relief (MoDMR))Development partnersMeeting ScheduleThe working group will be convened at least quarterly. However, additional meetings can be called by the chair as needed to achieve its overall objectives. Follow-up of decisions and actions agreed during the meetings will be the responsibility of NFIS-B Secretariat. Agenda, minutes of the meetings, accompanying documents and presentations will be managed and shared by the Secretariat.LocationThe working group will convene at a location as determined by the Chairperson.ApprovalThis terms of Reference is approved by the NFIS-B Steering Committee, and any change(s) in the ToR or structure of the working group shall be approved by Chairman of the NSC.Annexure 4.2: Digital Financial Services Working GroupPurposeThe NFIS-B Thematic Working Groups support the NSC to advance financial inclusion in specific technical areas at national level. The Working Groups will be a forum for having all stakeholders from the public, private and donor communities come together to make the recommendations to be considered by the NSC and / or the NAC.BackgroundAccess to finance for the poor is essential to promote inclusive economic growth and to eradicate poverty in the country. A developed inclusive financial system not only expedites the process of resource mobilization and use, it also provides financial services to all who need them. It creates employment opportunities, ensures economic and financial stability through reducing vulnerability, and contributes to poverty reduction. As a policy, financial inclusion is recognized to have significant potential for improving the well-being for all, and especially for the participants in unserved and under-served financial markets who belong to the poor and marginalized groups; CMSMEs; small and marginal farm households; participants in informal sector activities; youth and women belonging to poor households; indigenous people; persons with disabilities; and other disadvantaged groups.In recognition of this the People’s Republic of Bangladesh has developed and approved the National Financial Inclusion Strategy of Bangladesh 2020 – 2024 (NFIS-B) during 2019. The Strategy lays out the priorities to be pursued in the area of financial inclusion over the next five years, under the able leadership of the Ministry of Finance and the Bangladesh Bank.Financial inclusion is an inter-ministerial and multi stakeholder process, and thus there is a need for overall coordination at National level. The NFIS-B National Committee has been formed to provide overall leadership in the implementation of the NFIS-B, while the NFIS-B Steering Committee and NFIS-B Advocacy Committee support the National Council in coordinating stakeholders. The thematic Working Groups will further support the NFIS-B implementation process by providing deep technical knowhow and knowledge to the national committees. Five Working Groups have been formed:Financial Sector DeepeningDigital financial services.CMSME.Consumer empowerment and risk management Data and measurement MandateThe Government of Bangladesh recognizes that the development of Digital Financial Services in the country can only be truly accelerated by encouraging coordination and creating synergies between different industry players. The primary objective of the DFS Working Group is to provide a platform for aligning stakeholder activities and encourage collaboration between public and private players in accelerating the development of the DFS ecosystem in Bangladesh for financial inclusion under the umbrella of the NNC and with the objectives of the NFIS-B, to promote financial inclusion.The Terms of Reference (ToR) of the DFS Working Group will be as follows:Make recommendations and provide technical advice and leadership to the national implementation committees to ensure the successful implementation of issues under Goal 2 (payments) and Goal 6 (DFS / innovation).Provide an appropriate forum for industry level dialogue where DFS stakeholders (government, businesses and donors) engage regularly to discuss DFS initiatives that will lead to greater financial inclusionIdentify constraints and opportunities related to the deployment and expansion of scalable DFS services in Bangladesh, especially in rural and remote areasPromote collaboration and partnerships among the different players for delivering financial services in a transparent, fair and safe mannerAdvocate support from government for DFS initiatives and assist in the framing of progressive DFS regulations and financial inclusion policiesSupport the development of innovative models and solutions for widening the reach of formal financial services by serving as a platform for generating and sharing knowledgeIdentify and support regulators sandboxes to allow small scale, live testing of innovations by private firms in a controlled environment (operating under a special exemption, allowance, or other limited, time-bound exception) under the regulator’s supervision. Support the NNS, NSC and the NAC with technical input to ensure appropriate decisions and resolutions in the area of digital financial ernanceThe DFS Working Group will be convened will be chaired by the Bangladesh Bank, whereas the NFIS-B Secretariat of the Bangladesh Bank will serve as secretary.MembersThe DFS Working group will be an inclusive platform for coordination and learning, and is open to all DFS stakeholders in Bangladesh, including the Government, Donors, NGOs, Financial Institutions, MNOs and others engaged in providing digital financial services in the country. Each institution may appoint one senior officer and their alternate to be its representative, and the nominees should have expertise and experience in their relevant field (including banking, payments, micro-finance, telecoms and distribution).Guests and other participants may be invited to specific discussions of the thematic working group, to bring relevant information, experience or insight. Observers are also welcome to attend the working group sessions, subject to advance approval.The initial membership of the DFS Working Group is proposed as follows:GM, NFIS Secretariat - ChairMoF (FID)A2iDevelopment partnersBangladesh Bank – Payments divisionCard companies (e.g. Visa, MasterCard).BTRCMoICT Representative companies in DFS sector (MFS providers, Fintechs, Banks, PSPs, Utility companies)Meeting ScheduleThe working group will be convened at least quarterly. However, additional meetings can be called by the chair as needed to achieve its overall objectives. Follow-up of decisions and actions agreed during the meetings will be the responsibility of NFIS-B Secretariat. Agenda, minutes of the meetings, accompanying documents and presentations will be managed and shared by the Secretariat.LocationThe working group will convene at a location as determined by the Chairperson.ApprovalThis terms of Reference is approved by the NFIS-B Steering Committee, and any change(s) in the ToR or structure of the working group shall be approved by Chairman of the NSC.Annexure 4.3: CMSME Working GroupPurposeThe NFIS-B Thematic Working Groups support the NSC to advance financial inclusion in specific technical areas at national level. The Working Groups will be a forum for having all stakeholders from the public, private and donor communities come together to make the recommendations to be considered by the NSC and / or the NAC.BackgroundAccess to finance for the poor is essential to promote inclusive economic growth and to eradicate poverty in the country. A developed inclusive financial system not only expedites the process of resource mobilization and use, it also provides financial services to all who need them. It creates employment opportunities, ensures economic and financial stability through reducing vulnerability, and contributes to poverty reduction. As a policy, financial inclusion is recognized to have significant potential for improving the well-being for all, and especially for the participants in unserved and under-served financial markets who belong to the poor and marginalized groups; CMSMEs; small and marginal farm households; participants in informal sector activities; youth and women belonging to poor households; indigenous people; persons with disabilities; and other disadvantaged groups.In recognition of this the People’s Republic of Bangladesh has developed and approved the National Financial Inclusion Strategy of Bangladesh 2020 – 2024 (NFIS-B) during 2019. The Strategy lays out the priorities to be pursued in the area of financial inclusion over the next five years, under the able leadership of the Ministry of Finance and the Bangladesh Bank.Financial inclusion is an inter-ministerial and multi stakeholder process, and thus there is a need for overall coordination at National level. The NFIS-B National Committee has been formed to provide overall leadership in the implementation of the NFIS-B, while the NFIS-B Steering Committee and NFIS-B Advocacy Committee support the National Council in coordinating stakeholders. The thematic Working Groups will further support the NFIS-B implementation process by providing deep technical knowhow and knowledge to the national committees. Five Working Groups have been formed:Financial Sector DeepeningDigital financial services.CMSME.Consumer empowerment and risk management Data and measurement MandateThe Government of Bangladesh recognizes the role that cottage, micro and small and medium enterprises play in job creation, and growth. There is also a recognition that access to finance remains a major challenge for many small enterprises in Bangladesh, which to be resolved must involve both traditional as well as new alternative mechanisms. The CMSME thematic working group will focus on strategies identified under the NFIS-B to extend coverage of the SMSME by the financial sector, as outlined under relevant targets in Goals 1 and 10 of the NFIS-B. Furthermore the working group will coordinate closely with the Financial Sector Deepening thematic working group for aspects related to the CMSMEs, ensuring that synergies are exploited. The primary objective of the CMSME working committee is to bring together stakeholders in the related sectors to promote access to finance for enterprises.The Terms of Reference (ToR) of the CMSME Working Group will be as follows:Make recommendations and provide technical advice and leadership to the national implementation committees to ensure the successful implementation of issues under Goal 1 (financial deepening targets 2, 4, 5, 7, 11 and 12 that are related to CMSMEs) and Goal 10 (Capital Markets)Provide an appropriate forum for industry level dialogue where relevant stakeholders (government, businesses and donors) engage regularly to discuss CMSME initiatives that will lead to greater financial inclusionIdentify constraints and opportunities related to the deployment and expansion of financial services for CMSMEs in Bangladesh, including women owned, and in rural and remote areasPromote collaboration and partnerships among the different players for delivering financial services in a transparent, fair and safe mannerSupport the development of innovative models and solutions for widening the reach of formal financial services by serving as a platform for generating and sharing knowledgeSupport the NNS, NSC and the NAC with technical input to ensure appropriate decisions and resolutions in the area of CMSME ernanceThe CMSME Working Group will be convened will be chaired by the Bangladesh Bank, whereas the NFIS-B Secretariat of the Bangladesh Bank will serve as secretary.MembersThe CMSME Working group will be an inclusive platform for coordination and learning, and is open to the main stakeholders in the Government, Donor, NGO, and Financial Institutions sectors. Each institution may appoint one senior officer and their alternate to be its representative, and the nominees should have expertise and experience in their relevant field.The initial membership of the CMSME Working Group is proposed as follows:BB – Sustainable Finance Department (Chair)BB – Financial Inclusion DepartmentNFIS Secretariat BSECBangladesh Investment Development Authority (BIDA)MRAMinistry of IndustriesSME FoundationPKSFBSCICMOF (FID)Selected Trade bodies e.g. FBCCI, DCCI, MCCI, Womens Entrepreneur Association, BSCIC etc.Development partnersMeeting ScheduleThe working group will be convened at least quarterly. However, additional meetings can be called by the chair as needed to achieve its overall objectives. Follow-up of decisions and actions agreed during the meetings will be the responsibility of NFIS-B Secretariat. Agenda, minutes of the meetings, accompanying documents and presentations will be managed and shared by the Secretariat.LocationThe working group will convene at a location as determined by the Chairperson.ApprovalThis terms of Reference is approved by the NFIS-B Steering Committee, and any change(s) in the ToR or structure of the working group shall be approved by Chairman of the NSC.Annexure 4.4: Consumer empowerment and risk management Working GroupPurposeThe NFIS-B Thematic Working Groups support the NSC to advance financial inclusion in specific technical areas at national level. The Working Groups will be a forum for having all stakeholders from the public, private and donor communities come together to make the recommendations to be considered by the NSC and / or the NAC.BackgroundAccess to finance for the poor is essential to promote inclusive economic growth and to eradicate poverty in the country. A developed inclusive financial system not only expedites the process of resource mobilization and use, it also provides financial services to all who need them. It creates employment opportunities, ensures economic and financial stability through reducing vulnerability, and contributes to poverty reduction. As a policy, financial inclusion is recognized to have significant potential for improving the well-being for all, and especially for the participants in unserved and under-served financial markets who belong to the poor and marginalized groups; CMSMEs; small and marginal farm households; participants in informal sector activities; youth and women belonging to poor households; indigenous people; persons with disabilities; and other disadvantaged groups.In recognition of this the People’s Republic of Bangladesh has developed and approved the National Financial Inclusion Strategy of Bangladesh 2020 – 2024 (NFIS-B) during 2019. The Strategy lays out the priorities to be pursued in the area of financial inclusion over the next five years, under the able leadership of the Ministry of Finance and the Bangladesh Bank.Financial inclusion is an inter-ministerial and multi stakeholder process, and thus there is a need for overall coordination at National level. The NFIS-B National Committee has been formed to provide overall leadership in the implementation of the NFIS-B, while the NFIS-B Steering Committee and NFIS-B Advocacy Committee support the National Council in coordinating stakeholders. The thematic Working Groups will further support the NFIS-B implementation process by providing deep technical knowhow and knowledge to the national committees. Five Working Groups have been formed:Financial Sector DeepeningDigital financial services.CMSME.Consumer empowerment and risk management Data and measurement MandateThe Government of Bangladesh recognizes that responsible finance, consumer empowerment and risk management are core to the sustainability of all financial inclusion initiatives. The Consumer Empowerment and Risk Management (CERM) Working Group will focus on issues identified in Goal 4 and Goal 8 of the NFIS-B, which further support this sustainability agendaThe Terms of Reference (ToR) of the CERM Working Group will be as follows:Make recommendations and provide technical advice and leadership to the national implementation committees to ensure the successful implementation of issues under Goal 4 (Financial Literacy and Consumer Empowerment) and Goal 8 (risk management)Provide an appropriate forum for industry level dialogue where relevant stakeholders (government, businesses and donors) engage regularly to discuss consumer empowerment initiatives that will lead to greater and sustainable financial inclusionIdentify constraints and opportunities related to the deployment and expansion of financial literacy programmes to individual and CMSMEs in Bangladesh, including women owned, and in rural and remote areasPromote collaboration and partnerships among the different players for delivering financial services in a transparent, fair and safe mannerSupport the development of innovative models and solutions for widening the reach of formal financial services by serving as a platform for generating and sharing knowledgeSupport the NNS, NSC and the NAC with technical input to ensure appropriate decisions and resolutions in the area of consumer empowerment and risk ernanceThe CERM Working Group will be convened will be chaired by the Bangladesh Bank, whereas the NFIS-B Secretariat of the Bangladesh Bank will serve as secretary.MembersThe CERM working group will be an inclusive platform for coordination and learning, and is open to the main stakeholders in the Government, Donor, NGO, and Financial Institutions sectors. Each institution may appoint one senior officer and their alternate to be its representative, and the nominees should have expertise and experience in their relevant field.The initial membership of the CERM Working Group is proposed as follows:BB – Financial Inclusion Department (Chair)NFIS Secretariat MoF (FID)Ministry of Primary and Mass Education (MoPME)MRAIDRABTRC BSECBFIUDevelopment partnersMeeting ScheduleThe working group will be convened at least quarterly. However, additional meetings can be called by the chair as needed to achieve its overall objectives. Follow-up of decisions and actions agreed during the meetings will be the responsibility of NFIS-B Secretariat. Agenda, minutes of the meetings, accompanying documents and presentations will be managed and shared by the Secretariat.LocationThe working group will convene at a location as determined by the Chairperson.ApprovalThis terms of Reference is approved by the NFIS-B Steering Committee, and any change(s) in the ToR or structure of the working group shall be approved by Chairman of the NSC.Annexure 4.5: Data and Measurement Working GroupPurposeThe NFIS-B Thematic Working Groups support the NSC to advance financial inclusion in specific technical areas at national level. The Working Groups will be a forum for having all stakeholders from the public, private and donor communities come together to make the recommendations to be considered by the NSC and / or the NAC.BackgroundAccess to finance for the poor is essential to promote inclusive economic growth and to eradicate poverty in the country. A developed inclusive financial system not only expedites the process of resource mobilization and use, it also provides financial services to all who need them. It creates employment opportunities, ensures economic and financial stability through reducing vulnerability, and contributes to poverty reduction. As a policy, financial inclusion is recognized to have significant potential for improving the well-being for all, and especially for the participants in unserved and under-served financial markets who belong to the poor and marginalized groups; CMSMEs; small and marginal farm households; participants in informal sector activities; youth and women belonging to poor households; indigenous people; persons with disabilities; and other disadvantaged groups.In recognition of this the People’s Republic of Bangladesh has developed and approved the National Financial Inclusion Strategy of Bangladesh 2020 – 2024 (NFIS-B) during 2019. The Strategy lays out the priorities to be pursued in the area of financial inclusion over the next five years, under the able leadership of the Ministry of Finance and the Bangladesh Bank.Financial inclusion is an inter-ministerial and multi stakeholder process, and thus there is a need for overall coordination at National level. The NFIS-B National Committee has been formed to provide overall leadership in the implementation of the NFIS-B, while the NFIS-B Steering Committee and NFIS-B Advocacy Committee support the National Council in coordinating stakeholders. The thematic Working Groups will further support the NFIS-B implementation process by providing deep technical knowhow and knowledge to the national committees. Five Working Groups have been formed:Financial Sector DeepeningDigital financial services.CMSME.Consumer empowerment and risk management Data and measurement MandateThe Government of Bangladesh recognizes that the ready availability of accurate and suitably aggregated data is core to the development and implementation of targeted and effective financial inclusion initiatives. The Data and Measurements (D&M) Working Group will focus on issues identified in Goal 3 of the NFIS-B, establishing a robust Data and Measurement framework.The Terms of Reference (ToR) of the D&M Working Group will be as follows:Make recommendations and provide technical advice and leadership to the national implementation committees to ensure the successful implementation of issues under Goal 3 (Data and Measurement Framework)Provide an appropriate forum for industry level dialogue where relevant stakeholders (government, businesses and donors) engage regularly to discuss data and measurement initiatives that will lead to better and targeted financial inclusion initiativesIdentify constraints and opportunities related to the availability of data and measurement frameworks, including aggregation at the correct levelsSupport the development of innovative models and solutions for widening the reach of formal financial services by serving as a platform for generating and sharing knowledgeSupport the NNS, NSC and the NAC with technical input to ensure appropriate decisions and resolutions in the area of data and ernanceThe D&M Working Group will be convened will be chaired by the Bangladesh Bank, whereas the NFIS-B Secretariat of the Bangladesh Bank will serve as secretary.MembersThe D&M working group will be an inclusive platform for coordination and learning, and is open to the main stakeholders in the Government, Donor, NGO, and Financial Institutions sectors. Each institution may appoint one senior officer and their alternate to be its representative, and the nominees should have expertise and experience in their relevant field.The initial membership of the D&M Working Group is proposed as follows:BB – Financial Inclusion Department (Chair)NFIS Secretariat MoF (FID)BBSStatistics and Information Division of Ministry of Planning (MoP)BB – Bank supervisionMRAIDRADevelopment partners Meeting ScheduleThe working group will be convened at least quarterly. However, additional meetings can be called by the chair as needed to achieve its overall objectives. Follow-up of decisions and actions agreed during the meetings will be the responsibility of NFIS-B Secretariat. Agenda, minutes of the meetings, accompanying documents and presentations will be managed and shared by the Secretariat.LocationThe working group will convene at a location as determined by the Chairperson.ApprovalThis terms of Reference is approved by the NFIS-B Steering Committee, and any change(s) in the ToR or structure of the working group shall be approved by Chairman of the NSC.Annexure 5: NFIS B Secretariat CharterPurpose The NFIS-B National Secretariat will be established at the Bangladesh Bank to provide technical support to the NFIS-B coordination bodies.Proposed Sections/Divisions The Secretariat will be a dedicated department within Bangladesh Bank, headed by an Executive Director who will be deputised by a General Manager. The organisational structure of the Secretariat and all appointments to be made will be approved by the Head of NSC, i.e. the Governor of Bangladesh Bank. The Governor will also ensure that adequate operational and administrative budget is allocated by Bangladesh Bank.Sufficient capacity in the Secretariat will be necessary to ensure adequate follow ups and data collection, and it is important that a number of full-time staff are assigned to the Secretariat unit.At a minimum the following departments within the Secretariat are envisaged:Financial Inclusion SupportStatistics, Monitoring and EvaluationAdvocacy, awareness and industry outreachThe Secretariat will work closely with, or be implemented within the BB Sustainable Finance and the BB Financial Inclusion Departments.ResponsibilitiesThe role of the Secretariat is defined as follows:Financial Inclusion Implementation SupportPerform all operational, administrative, technical research and secretarial activities needed for the implementation of NFIS-B, in support of the activities to be carried out by the NNC, NSC and NAC.Work with all stakeholders to raise awareness and to drive forward critical issues in financial inclusion.Establish a permanent mechanism to coordinate with regulatory bodies, industry associations, donor partners, and other stakeholders.Support the thematic working groups on important focus areas relating to the financial inclusion agenda, providing technical and professional support to ensure the committees perform their responsibilities.Hold ongoing engagement with the stakeholder community, including the private sector, and ensure that the NFIS is regularly updated and relevant to national needs.Prepare regular reports for updating the stakeholders, including M&E reports.Statistics, information and DataProvide financial inclusion data support, providing M&E and statistical analysis for financial inclusion issues in BangladeshCollect supply side data (from various sector regulators and associations, and the BBS), maintain MIS and prepare M&E reports for NNC, NSC and NAC Partner with other agencies and development partners to conceptualise and operationalize a comprehensive demand side survey as called upon in the NFIS-B, and to maintain it on a regular basisEnsure the availability of financial inclusion data to orient informed decisions, and create a holistic financial inclusion data repository. Maintain a website to promote financial inclusion and to provide stakeholders with up to date and accurate dataLead and coordinate the compilation of data needed for monitoring and evaluation purposes.Advocacy and AwarenessEnsure awareness and promotion of the financial inclusion agenda in the public space, including the dissemination of the NFIS-B among stakeholders.Ensure that financial inclusion continues to be prominent in policy debates, whether in other relevant Ministries or in the international forums.Ensure that financial inclusion imperatives are reflected in broader Government policy and regulatory decisions.Coordinate with other ministries in the development of strategies and policies that impact on financial inclusion (e.g. agriculture, cooperatives, SME, women, youth, ICT, etc.).Represent government position on financial inclusion in local and international forums.Annexure 6: NFIS-B Year Wise Implementation PlanGoal 1: Increase Financial DeepeningTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241.Introduce e-KYC for all types of bank accounts, MFS accounts and other regulated financial services accountCurrently there is one on-going eKYC pilot for MFS; Expanded use of eKYC will encourage more account opening.MFS eKYC pilot is completed, and Bangladesh Bank issues guideline / regulation for e-KYC for the MFS sectorBB, MoF (FID/Finance Division), BTRC, A2i, Ministry of Posts, Telecommunications and Information Technology, Banks, NBFIs, MFS providers, BPO??????# of customer accounts authenticated using eKYCHighCarry out any necessary pilots and issue guideline / regulation for e-KYC for the commercial bank sectorBB, Banks, BTRC, A2i, Ministry of Posts, Telecommunications and Information Technology, MFS providers, BPO??????Develop and issue an MFI sector uniform KYC guideline, including a future provision for eKYCMRA, MFIs, BTRC, A2i, Ministry of Posts, Telecommunications and Information Technology,??????Develop and issue eKYC guidelines for the insurance sectorIDRA, Insurance companies, BTRC, A2i, Ministry of Posts, Telecommunications and Information Technology??????2.Revisit the KYC requirement for cottage and micro enterprises, micro-merchant/retails businesses and low-income households.KYC requirements for micro enterprises and low income households is unnecessarily onerous; More flexible / user friendly KYC will encourage account openingReview, benchmark and revise the KYC requirements for micro enterprises and low income householdsBB, MoF (FID/Finance Division), SME foundation, PKSF, Ministry of Commerce, Trade bodies, Banks, NBFIs, MFIs. ??????KYC requirement revisedLow3.Ensure the access of all regulated financial service providers to ‘National ID database’ of Election Commission and ‘Biometric Database’ of Bangladesh Telecommunication Regulatory CommissionBanks and MFSPs have access to NID database but not MFIs or insurance companies. Access to NID will ease KYC and reduce fraudMRA and IDRA negotiate with all relevant agencies, and sign an agreement on how MFIs and insurance companies should access the NID databaseMRA, IDRA, MFIs, Insurers, BB, National Identification Wing, Election Commission, Ministry of Home Affairs ??????% of MFIs and insurers able to access NID databaseHighMRA and IDRA negotiate with all relevant agencies, and sign an agreement on how MFIs and insurance companies will access the BTRC biometric databaseMRA, IDRA, BTRC, MFIs, Insurers??????% of MFIs and insurers able to access BTRC database4.Introduce the framework for ‘socially responsible financing’A guideline on socially responsible finance exists but needs to be strengthened to encourage FSPs to roll out more responsible finance mechanismsDevelop a detailed 'socially responsible finance' framework, based on the existing guideline, and focused on promoting socially responsible financing mechanisms such as green financeBB, MoF (FID/Finance Division), Banks and NBFIs??????Loan portfolio of responsible finance mechanismsMedium5.Expand the scope and practice of ‘Cluster’ and ‘Value Chain’ financing.Cluster and Value chain finance have a key role to play in the economy. Relevant policy instruments should prioritise this important areaBangladesh Bank should prioritise and expand the scope and practice of ‘Cluster’ and ‘Value Chain’ financing by issuing a new Finance GuidelineMinistry of Industry and Commerce, BB, MRA, MoF (FID/Finance Division), SME foundation, PKSF, Banks, NBFIs and MFIs??????Loan portfolio of cluster and value chain finance mechanismsLowThe Industrial Policy of the Ministry of Industry should be revised / amended to add focus on ‘Cluster’ and ‘Value Chain’ financingMinistry of Industry and Commerce, BB, MRA, MoF (FID/Finance Division), SME foundation, PKSF, Banks, NBFIs and MFIs??????The SME Policy of the Ministry of Industry currently being considered should prioritise ‘Cluster’ and ‘Value Chain’ financingMinistry of Industry and Commerce, BB, MRA, MoF (FID/Finance Division), SME foundation, PKSF, Banks, NBFIs and MFIs??????6.Take necessary initiatives for making account opening process as optimally simple and convenient for allAccount opening processes and KYC are still complicated for low income customers; Easier processes will encourage account opening.Review and issue guideline / circular to simplify process and KYC requirements for bank account opening for low income customersBB, MoF (FID/Finance Division), Banks and NBFIs??????Account opening process simplifiedLowReview and issue guideline / circular to simplify process and KYC requirements for MFI account opening for low income customersMRA, PKSF, MFI, MoF (FID/Finance Division)??????Review and issue guideline / circular to simplify process and KYC requirements for Insurance account opening for low income customersIDRA, Insurance Companies, MoF (FID/Finance Division)??????7.Develop framework for diversifying financing instruments and financing options for CMSMEs and low-income householdsSome finance mechanisms already exist however these need to be expanded by encouraging innovative product solutions for CMSMEs and a wider range of finance instrumentsRevisit the BB refinancing programme for SMEs, to incorporate factoring, reverse factoring and other innovative finance mechanismsBB, MoF (FID/Finance Division), SME foundation, Ministry of Commerce, Trade bodies, Banks, NBFIs, ??????# of additional finance mechanisms available to CMSMEsMediumRevisit the BSEC Alternative Investment Rules of 2015, to include additional mechanisms such as crowd funding and special purpose vehiclesBSEC, Venture Capital Investment Companies, DSE and CSE ??????MRA to develop a micro enterprise policy guideline, focusing on different instruments relevant to micro enterprisesMRA, PKSF, MFIs??????8.Take necessary actions to reduce fiscal burden on the usage of financial services for consumers specially in DFSLowering taxes on e-transactions will encourage customer transition towards more efficient and transparent DFS platformsNational Board of Revenues should review and revise downward the existing taxes on electronic / mobile money transactions feesNBR, MoF (FID/Finance Division), BB, BTRC??????eTransaction taxes revised downwardsLow9.Establish Micro-Finance Credit Information Bureau (CIB), Collateral (both movable and immovable) Registry Bureau for financial services and upgrade the existing CIB under Bangladesh Bank into full fledged ‘Credit Registry’Existing CIB caters only to banks, while the asset registry caters only to fixed assets. Expansion of CIB and credit registry services will make it easier for CSMSEs and individuals to access loans, including through movable asset financingMRA in partnership with BB to complete the on-going development of a Credit Information Bureau for MFIsMRA, BB??????# of MFI CIB records;# of records in bank and MFI moveable registryMediumPass the Secured transaction law (currently in draft), to create a framework for secured transactions and for a collateral registryMLJPA, BB, MRA??????Review and optimise collateral enforcement mechanism for moveable collateralMLJPA, BB, MRA??????Establish a moveable collateral registry for banks, by upgrading the existing fixed asset registryBB, MoF (FID/Finance Division), Banks and NBFIs??????Establish a moveable collateral registry for MFIs, in conjunction or separately from the bank asset registryMRA, MoF (FID/Finance Division), MFIs??????10.??????? Introduce the usage of artificial intelligence and machine learning for credit scoring and monitoring through big data analysisA pilot on use of such alternative data is on-going with one credit rating agency in partnership with banks and MFIs; this needs to be supported and expanded for to increase service provider products, efficiency and reachComplete existing pilot and share learnings with wider market to allow for replication / targetingBSEC, NFIS secretariat, BB, MoF (FID/Finance Division), A2i, Rating Agencies??????# of providers utilising AI / Machine learning for big data analysisMediumSupport for alternative data approaches from BB and BSEC in form of a circular endorsing the innovative approaches to encourage the private sectorBB, BSEC, BSEC, NFIS secretariat, BB, MoF (FID/Finance Division), A2i, Rating Agencies??????Private sector, especially Fintech players, credit rating agencies, e-platform providers, ecommerce players, and MFS / DFS providers explore new opportunities to exploit AI, machine learning and big data analysisNFIS Secretariat, Private Sector, Rating Agencies ??????11.??????? Introduce ‘Credit Guarantee Fund’ for CMSME finance, agricultural finance and green financeA public credit guarantee scheme will help reduce the supply-demand gap in SME finance; it already exist in 16 of the 20 ASM countriesStakeholder engagements and benchmarking to agree a funding and implementation mechanism that is agreeableBB, MoF (FID/Finance Division), SME Foundation, Ministry of Agriculture, Ministry of Commerce, Trade bodies, Banks, NBFIs, MFIs??????Credit guarantee fund operational;# of CMSMEs supportedMediumBangladesh Bank in partnership with the SME foundation establish and launch a credit guarantee fund for CMSMEsBB, SME foundation, MoF (FID/Finance Division) ??????12. Take necessary initiatives for developing refinancing mechanism for funding ‘Start-ups’A start-up refinance mechanism can support start-ups; Currently BB has no mechanisms for start ups, while the ICT Ministry has one only for the ICT sector.BB to start a new refinancing mechanisms for start-upsBB, MoF (FID/Finance Division), Venture capital financing companies, Banks, NBFIs??????# of CMSMEs supported by start-up refinance mechanismHigh13.??????? Make required arrangement for facilitating smooth inward remittance of domestic professionals on Business Process Outsourcing and NRBsCustomers need a wider variety of providers for domestic remittances beyond banks; A significant number of adults still remit in cash. Revisit the MFS guidelines of 2011 to ensure MFS remittance transaction limits are market related and encourage growth of formal remittancesBB, MoF (FID/Finance Division), Ministry of Expatriates’ Welfare and Overseas Employment, Ministry of Labour and Employment, Banks, MFIs and MFS providers ??????% of domestic remittances through MFS and MFIsLowIssue guideline / circular to encourage domestic remittances partnership between banks and MFIs to better cater to the need of poor householdsBB, MRA??????14.??????? Formulate policy framework for Micro-savings by BB and MRALow income households especially in rural areas need additional and viable options to keep their microsavings; MFIs and MFS provide the most viable optionsDevelop a policy framework for the collection of micro savings from MFI non-members, and amend the relevant clauses of the MRA rules of 2010 to remove restrictionsBB, MoF (FID/Finance Division), MRA, MFIs??????Value of micro savings held by MFI and MFS providersLowDevelop a policy framework to promote micro savings through MFS, including by revising the applicable transaction limitsBB, MFS providers??????15.??????? Explore the feasibility to introduce 'P2P Lending' and 'Crowd Funding'New innovative funding mechanisms especially relevant to start ups need to be encouraged in BangladeshRevisit the BSEC Alternative Investment Rules of 2015, to include additional mechanisms such as P2P lending and crowd fundingBSEC, BB, Venture capital financing companies ??????BSEC Alt investment Rules of 2015 revisedLow16.??????? Create mechanisms of robust information sharing for convenient client on-boardingIncreased information sharing and database linkages will ease client on boarding, thereby reducing risks and encouraging account openingMRA and BB develop mechanisms for robust information sharing in relation to client on boarding - NID database platforms for individuals/businesses; - Proper functioning and linkage of CIBs; - Linkages between NID database and CIBs; - Linkages between collateral registration registries; - Risk based tiered KYC; - Regulatory environment for rating agencies, etc.MRA, BB, MoF (FID/Finance Division), A2i, Ministry of Posts, Telecommunications and Information Technology??????Robust information sharing between the bank and MFI sectors is in placeLowGoal 2: Strengthen payment system and service delivery channelTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241.??????? Ensure interoperability within all MFS accountsInteroperability will increase utility of and usage of DFS services.Put in place a Guideline and the necessary infrastructure to ensure MFS-MFS interoperability (i.e. under the interoperability infrastructure project due for completion in Dec 2019)BB, MoF (FID/Finance Division), BTRC, Banks??????MFS-MFS interoperability in placeLow2.??????? Ensure interoperability within all MFS and bank accountsInteroperability will increase utility of and usage of DFS services: Bank-Bank is in place but not Bank-MFSPut in place a Guideline and the necessary infrastructure to ensure MFS-Bank interoperability (i.e. under the interoperability infrastructure project due for completion in Dec 2019)BB, MoF (FID/Finance Division), BTRC, Banks, MFS providers??????MFS-Bank interoperability in placeMedium3.??????? Ensure the transformation of all branches of all banks into online branchesOnline branches enhance service delivery and efficiency; Commercial bank branches are online but some State Owned Commercial banks are laggingSecure funding and implement the necessary systems (hardware and software) to ensure all branches are onlineMoF (FID/Finance Division), BB, SOCBs, Banks??????% of bank branches that are onlineMediumTrain staff to operate the newly automated State Owned Commercial Bank online branches??????4.??????? Ensure the participation of all banks in interbank Automated Teller Machines (ATM), Point of Sales (POS) and Internet Banking Fund Transfer (IBFT)An interlinked interoperable system enhance service delivery and efficiency; All 59 banks are on RTGS/EFT however only 51 are linked on ATM/POS and 16 on IBFTEngage with non-linked banks and issue a circular to define the timeline for the remaining banks to be connected on ATM/POS and IBFT systemsBB, MoF (FID/Finance Division), SOCBs, Banks??????% of banks participating in interbank ATM, POS and IBFT systemsLowImplementation of relevant infrastructure by remaining banks to participate in interbank ATM, POS and IBFTSOCBs, MoF (FID/Finance Division), BB, banks??????5.??????? Establish a ‘Payment System Coordination Council’ consisting of relevant regulatory bodiesA Payment System Coordination Council will support growth of DFS across all platforms (bank, MFI, MFS, etc.)Develop the necessary terms of reference and set up the Payment System Coordination CouncilBB,MRA, MoF (FID/Finance Division), BTRC, Banks, MFIs??????Payment System Coordination Council in placeLow6.??????? Bring all types of Government payments (P2G and G2P) including social security payments under financial services (either bank account or MFS account)Digitized G2P and P2G payments will help build scale and consumer confidence; Currently many payments can be made on bank account but not MFS platforms. The level of digitization should also be increased and use of cash minimisedMoF to issue a circular prioritising the digitisation of G2P and P2G payments across all MinistriesMoF (Finance Division), BB, BTRC, Banks, MFS providers, BPO and Fintechs??????% of government payments that are digital;% of government payments that are digitisedMediumSupport the MoWCA to digitize all the main G2P social welfare payments on bank and MFS platformsMoWCA, BB, MoF (Finance Division), NFIS Secretariat, Banks, MFS providers, BPO and Fintechs??????Support the MoPEMR and the MoWR to digitize major utility payments on bank and MFS platformsNFIS Secretariat, MoPEMR, MoWR, MoF(Finance Division), Banks, MFS providers, BPO and Fintechs??????Support the Bangladesh National Board of Revenue to digitize revenue collection, including on MFS platformsNFIS secretariat, NBR, MoF (Finance Division)??????Support other line Ministries to identify and digitize key G2P and P2G payment streams, including MFS platforms to support the paymentsNFIS secretariat, MoF (Finance Division)??????7.??????? Take necessary initiatives to digitize ‘Micro-Merchant Payments’ and ‘Retail Transport Payment’Digitization of micro merchant payments will increase efficiency for merchants, and transparency at fiscal level. Currently transaction limits and cash withdrawal limits hamper such digitizationBangladesh Bank to issue new / revised circular to increase the applicable MFS transaction limits, and cash withdrawal limits outside of the bankBB, MoF (FID/Finance Division), BTRC, Bank, MFS providers??????# of micro merchant accounts on MFS platformsLowPrivate sector through the FBCCI to encourage merchants use digitize their receipts and paymentsFBCCI, MoF (FID/Finance Division), SME Foundation??????8.??????? Enhance the scope of MFI linkage for providing banking and MFS servicesBank / MFI linkages can be mutually beneficial as Banks are able to reach further into the market through wholesale credit and agent relationships. MFIs in turn can make better use of MFS services for enhanced efficiency and reach.Issue MRA guideline for use of MFS in the MFI sector to encourage adoption and linkages with MFS servicesBB, MoF (FID/Finance Division), BTRC, MRA, Banks, MFS providers, MFIs??????# of MFIs offering bank servicesLowEncourage Banks to put more resources into and make more use the MFI sector: through credit wholesaling and as agent banks, MFS agents and foreign remittance channels. (regulations already in place)BB, MRA, Banks, MFIs??????Engage with banks and consider mandatory wholesale agricultural lending limits to MFIs, with suitable regulations for the effective and efficient end-use of the credit.BB, MRA, Banks, MFIs??????Encourage bigger MFI players to build on existing pilots and roll out services on MFS platform to create market learnings and increase client comfort with technologyMFIs, MRA, MFSPs??????Evaluate potential of issuing limited banking services licenses to bigger MFIs and transform them into microfinance or specialised banks; and create a mechanism for the transformationBB, MoF (FID), MLJPA, MRA, NFIS Secretariat??????Work with BTRC to improve rural internet servicesMRA, BTRC??????9.??????? Enhance the scope of financial service providing by PSPsExisting PSPs regulations could be revised to attract more PSPs and enhance their service offeringAmend the PSP regulations - focusing on the capital requirements, flexibility and service range from the PSPsBB, MoF (FID/Finance Division), BTRC, Ministry of Posts, Telecommunications and Information Technology??????PSP regulation amendedLow10.??????? Initiate the formulation of National Payment ActA National Payment Act will be useful to improve the regulatory structures for the national payment systems and services, and to promote DFSFormulate, draft and pass the National Payment ActMLJPA, BB, MoF (FID/Finance Division), BTRC, Ministry of Posts, Telecommunications and Information Technology ??????National Payments Act is passedMedium11.??????? Assess the feasibility of establishing payment bankEnable non-bank entities to set up payment banks to provide low risk payment services. Airtel (an MNO) has introduced payment banking in India on a pilot basis. MNO-led payment banking model could provide MFS cost effectively.Examine the feasibility of establishing small microfinance and / or payment banks - MFIs to become small microfinance banks with limits on their operations; - Potential participation of mobile operators in the payment bank modelBB, MoF (FID/Finance Division), BTRC, Ministry of Posts, Telecommunications and Information Technology??????Feasibility study for Payment bank model completedLowIf appropriate for Bangladesh, develop and issue regulations for the Payment bank modelBB, MoF (FID/Finance Division), BTRC, Ministry of Posts, Telecommunications and Information Technology??????Goal-3: Establish robust Data and Measurement frameworkTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241.????? Conduct a comprehensive country-wide demand side survey to appropriately assess the financial serviceA comprehensive demand side survey can provide needed customer focused information and enhance evidence based decision making and product developmentDevelop and implement a comprehensive country-wide demand side survey to appropriately assess the financial servicesNFIS Secretariat, BBS??????Survey implementedLow2.????? Establish a set of globally comparable national financial inclusion indicators in light of World Bank Findex, IMF Financial Access Survey and G20 Financial Inclusion IndicatorsA set of appropriate indicators will enable progress in financial inclusion to be tracked, and ease comparison with international peersDevelop a set of approved national financial inclusion indicators, linked to the World Bank Findex and other surveys, IMF Financial Access Survey and G20 Financial Inclusion indicators NFIS Secretariat??????Indicators are developed, approved and populated with baseline & targetsMedium3.????? Ensure the collection of comprehensive and quality financial inclusion data disaggregated by sex, age, location and other aspects A comprehensive set of quality financial inclusion data disaggregated by sex, age, location and other aspects will enhance evidence based decision making. The current available data needs to be enhanced especially as regards disaggregation.BB develops a template of comprehensive data and disaggregation required from banks, and agrees a plan with them for the data to be availableBB, NFIS Secretariat, BBS, Banks and NBFIs??????Each major sector has a comprehensive set of financial inclusion data agreed with NFIS secretariatLowMRA develops a template of comprehensive data and disaggregation required from MFIs, and agrees a plan with them for the data to be availableMRA, NFIS Secretariat, BBS, PKSF, MFIs??????IDRA develops a template of comprehensive data and disaggregation required from insurance companies, and agrees a plan with them for the data to be availableIDRA, NFIS Secretariat, BBS, Insurance Companies??????Other regulators develop a template of comprehensive data and disaggregation required from their respective areasNFIS Secretariat, BSEC, BBS??????4.????? Create robust and automated Management Information System and dedicated web-portal for NFIS-B data like SDG TrackerAn automated MIS and web portal will ease availability of relevant information to stakeholder to support innovation and evidence based decision makingDevelop an automated Management Information System and dedicated web-portal for NFIS-B data like SDG Tracker indicators .NFIS Secretariat, A2i ??????Web portal implemented with automated MISMedium5.????? Explore the potential ways for using ‘Cloud Solutions’ to store and preserve data by Financial Service Provider and Regulatory AgenciesUse of cloud solutions will facilitate easy and secure access to FSP data and further adoption of DFS servicesPromote the establishment of local cloud based solutions for use by financial services providersMoICT, NFIS Secretariat, A2i, Ministry of Posts, Telecommunications and Information Technology??????Regulators and FSPs have feasible options to store data on CloudLowConsider and develop a national digital policy, which covers establishment of a national cloud for data storage, guidelines on data management, and vulnerability tests for risk assessmentMoICT, BB, A2i, Ministry of Posts, Telecommunications and Information Technology ??????Revisit policy position restricting storage of data outside the country; and if revised, amend the ICT act to allow FSPs to store data outside the countryMoICT, BB??????6.????? Strengthen the capacity of statistical agency for national financial inclusion dataBBS is the custodian of data in the country; enhanced capacity of BBS will enable collection and availability of relevant financial inclusion dataImplement activities (training, study tours, system implementations, etc.) to strengthen the capacity of BBS in respect of financial inclusion dataNFIS Secretariat, BBS??????# of financial inclusion capacity building actvitiesLowGoal 4: Promote Financial Literacy and Consumer EmpowermentTargetsExpected ResultActivitiesLead & support institutionsTimelineTimelineTimeline2019202020212022202320241.????? Formulate Financial Literacy Policy/Strategy by all financial sector regulatory bodies separatelyThe formulation of sector based financial literacy policies / strategies will help direct and coordinate activities in the sectors, and allow synergies to be extractedBB to engage the Bank Sector and formulate a Financial Literacy Policy/Strategy for the sectorNFIS Secretariat, MoF (FID/Finance Division), MoE, BB??????Financial literacy strategies / policies in place for each of the three sectorsHighMRA to engage the MFI Sector and formulate a Financial Literacy Policy/Strategy for the sectorNFIS Secretariat, MoE MRA??????IDRA to engage the Insurance Sector and formulate a Financial Literacy Policy/Strategy for the sectorNFIS Secretariat, MoE, IDRA??????2. Formulate Consumer Protection Framework and Grievance Redressal System by all financial sector regulatory bodies separatelyThe formulation of Consumer Protection Framework and Grievance Redressal System will help increase consumer confidence in financial services. The BB already has a framework in place, including the CIPC which handles grivancesRevise the Bank Sector consumer protection policy to further improve it where possibleNFIS Secretariat, MoE ,BB??????Consumer protection framework & grievance handling policy in place for each of the three sectorsHighIntroduce an MFI sector consumer protection framework including a grievance redressal systemNFIS Secretariat, MoE, MRA??????Introduce an Insurance sector consumer protection framework including a grievance redressal systemNFIS Secretariat, IDRA, MoE??????3. All regulated financial service provider will have annual program on financial literacy which will be monitored by respective regulatory bodyFinancial service providers led programmes need to be prioritised as they have the closest connection to customers and have the most to gain from educated customers.Establish financial literacy 'year wise targets' for banks to comply with, and monitor compliance regularlyBB, MoF (FID/Finance Division), MoE, Banks, NBFIs??????FSP targets are in place for each of the three sectorsLowEstablish financial literacy 'year wise targets' for MFIs to comply with, and monitor compliance regularlyMRA, MoF (FID/Finance Division), MoE, MFIs??????Establish financial literacy 'year wise targets' for Insurance companies to comply with, and monitor compliance regularlyIDRA, MoF (FID/Finance Division), MoE, Insurance Companies.??????4. Take necessary initiatives with Ministry of Education to incorporate ‘Financial Literacy’ at all levels of education (Primary, Secondary, Tertiary)School and college graduates when financially literate will be able to use financial services later. School programmes complement ongoing initiatives e.g. school bank Engage with Ministry of Education to implement, and Ministry of finance to finance school and college level financial literacy programmesNFIS Secretariat, MoF (FID/Finance Division), MoE, Educational Institutions ??????# of schools offering financial literacy programmesMedium5. Assess the feasibility of introducing consumer protection mechanism similar to ‘Deposit Insurance Scheme’ for banksA deposit insurance scheme is useful to instil consumer confidence in financial services. Schemes are in place for banks and MFIs however the compensation in case of liquidation is insufficient.Revisit and revise the payable compensation amounts in case of bank liquidation (currently BDT 100,000)BB, MoF (FID/Finance Division), Banks??????Available Deposit Insurance compensation is revised for both banks and MFIsLowRevisit and revise the payable compensation amounts in case of MFI liquidation (currently BDT 3,000)MRA, MoF (FID/Finance Division), MFIs??????Goal 5: Broaden and Deepen Financial Inclusion of Women, Population affected by Climate Change and other underserved segment of populationTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241. Develop separate policy/strategy and undertake special programs by all regulatory bodies of financial sector on women financial inclusion covering the issues below:a).?Dedicated focus on catering the need financial services (saving, credit, payment, investment and insurance) of women individuals and entrepreneurs from both rural and urban areasb).?Convenient service delivery channel for womenc). Separate focus for women in DFSSpecial programmes are implemented across the major sectors to increase access to finance for women and women entrepreneursBB develops women focused financial inclusion targets for the bank sector, covering women individuals and women entrepreneursBB, MoWCA, Womens Entrepreneur Association, Ministry of Posts, Telecommunications and Information Technology, Banks, NBFI ??????Each regulator has a set of targets for women and women entrepreneursHighMRA develops women focused financial inclusion targets for the MFI sector, covering women individuals and women entrepreneursMRA, MoWCA, PKSF, Womens Entrepreneur Association, Ministry of Posts, Telecommunications and Information Technology, MFIs??????BSEC develops a women focused financial inclusion targets for the insurance sector, covering women individuals and women entrepreneursBSEC, MoWCA, Womens Entrepreneur Association, Ministry of Posts, Telecommunications and Information Technology, Venture Capital Investment Companies, DSE and CSE??????IDRA develops a women focused financial inclusion targets for the insurance sector, covering women individuals and women entrepreneursIDRA, MoWCA, Womens Entrepreneur Association, Ministry of Posts, Telecommunications and Information Technology, Insurance Companies. ??????2. Formulate target based specific policies and initiate dedicated programs by IDRA, BSEC and MRA as well as relevant government agencies on Financial Inclusion and Climate Change along with the reinforcing BB’s initiativesMeasures to reduce climate change or to help customers deal especially in Southern Bangladesh with climate change are put in place across all the major sectorsBB revises its targets on climate change for the bank sector, including for development of new productsBB, MoF (FID/Finance Division), MoEFCC, Ministry of Disaster Management and Relief (MoDMR)??????Each regulator has a set of up to date targets to help deal with climate changeMediumMRA develops targets on climate change for the MFI sector, including for development of new productsMRA, MoF (FID/Finance Division), MoEFCC, MoDMR??????BSEC develops targets on climate change for the capital markets sector, including for development of new productsBSEC, MoF (FID/Finance Division), MoEFCC, MoDMR??????IDRA develops targets on climate change for the Insurance sector, including for development of new productsIDRA, MoF (FID/Finance Division), MoEFCC, MoDMR??????3. Formulate target based specific policies and initiate dedicated programs by all regulatory bodies and relevant government agencies on following aspects of financial inclusion separately:?? Youth Financial Inclusion?? Financial Inclusion for Physically Challenged People?? Financial Inclusion for Third Gender?? Financial Inclusion for Children?? Financial Inclusion for Bangladeshi Diaspora/Non Resident Bangladeshi (NRBs)?? Financial Inclusion for extremely destitute and underprivileged people like tea labors, floating communities, urban slum dwellers, poor people in remote hilly, forest, coastal, haor, char with difficult terrain and similar areas; former enclave areas, sparsely populated areas and relatively underdeveloped areas with poor infrastructureMeasures to assist vulnerable populations are put in place across all the major sectorsBB introduces targets for the bank sector in each dimension of the vulnerable populationsBB, MoWCA, MoYS, MoLG, MoEW, MSW, MoDMR??????Each regulator has a set of up to date targets to assist vulnerable populations to access financeMediumMRA introduces targets for the MFI sector in each dimension of the vulnerable populationsMRA, MoWCA, MoYS, MoLG, MoEW, MSW, MoDMR??????BSEC introduces targets for the capital markets sector in each dimension of the vulnerable populationsBSEC, MoWCA, MoYS, MoLG, MoEW, MSW, MoDMR??????IDRA introduces targets for the insurance sector in each dimension of the vulnerable populationsIDRA, MoWCA, MoYS, MoLG, MoEW, MSW, MoDMR??????Goal 6: Upscale Digital Financial Services and FintechTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241. Formulate a DFS strategyA DFS strategy will help to coordinate activities in DFS and lead to increased uptake of DFS servicesDevelop a DFS Strategy (under the MoICT a2i project)MoICT, MoF (FID/Finance Division), BB, MRA, BTRC, IDRA??????DFS Strategy developed and approvedHigh2. Ensure the usage of DFS in all types of utility services (water, gas, electricity, internet, health, education and others) payments Utility payments can help create scale for DFS and also make the utility companies more efficientCatalyse and support the utility providers to digitize payments from customersNFIS Secretariat, BB, Utility providers, Banks??????Volume of DFS utility paymentsLow3. Assess the feasibility of application of Distributed Ledger Technology (DLT) in financial sectorDLT is an emerging technology globally that is helping to increase efficiency and security of certain types of transactions; Companies should explore where it could be useful locallyPrivate sector to explore local applications of DLT and implement appropriate pilots that could later be scaled into commercial venturesPrivate sector, fintech companies, BB??????DLT pilots in placeLow4. Explore the potential modalities to introduce credit service and full deposit service for MFS account holdersThe wide reach of MFS services should be used to deliver a wider range of financial services to all groups of customersConsider to amend the regulations to introduce credit service and full deposit service for MFS account holdersBB, MoF (FID/Finance Division), BTRC, Banks, MFS providers ??????Full credit and deposit services are available on MFSLow5. Explore the potential solutions to provide all banking services at full scale in outlet level under agent bankingThe wide reach of agent bank services should be used to deliver a wider range of financial services to rural customersAssess the viability and consider to introduce new or amend existing regulations to widen scope of services available from agent banksBB, MoF (FID/Finance Division), Banks??????Wider range of services available on Agent Bank channelLow6. Assess the potential scope of application of Fintech, Regtech, Suptech, InsurtechApplication of technology in regulatory and FSP processes can help improve service delivery and efficiencyConduct an assessment for how various technological advancements in Fintech, Regtech, Suptech, Insurtech could be used in BangladeshNFIS Secretariat, BB, MRA, IDRA, MoICT, BTRC, MoF (FID/Finance Division)??????Assessment completedLowGoal 7: Strengthen the policy and regulatory environmentTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241. Coordinate across Ministries, Regulatory Bodies and relevant government agencies for implementation of NFIS-BSuccessful implementation of NFIS-B depends on coordination across multiple agencies, ministries, regulators and sectorsDevelop and approve the terms of reference for the various coordination bodies recommended i.e. NFIS-B National Council, Steering Committee, Advocacy Committee and SecretariatNFIS Secretariat, MoF (FID), BB, MRA, IDRA, BTRC ??????Coordination bodies inaugural meeting heldHighInitiate regular meeting schedule for each coordination body, per the respective terms of referenceNFIS Secretariat, MoF / FID??????2. Establish the practice of evidence based policy makingEvidence based policy making can eliminate bias and maximise available resourcesAdvocate for and promote evidence based decision making for all key financial inclusion decisions in the coordination committees and implementation stakeholders, providing the necessary evidence where possibleNFIS Secretariat, MoF (FID/Finance Division),BB, MRA, IDRA, BTRC??????Evidence based decisions in coordination committeesLow3. Reinforce the coordination and coherent effort to refrain illegal financial services and eliminate the adverse impacts of Shadow BankingIn ‘shadow banking’, non-bank intermediaries provide services similar to traditional commercial banks outside of banking regulations, posing liquidity risks.Coordinate among regulators to identify a plan to deal with shadow bankingNFIS Secretariat, MoF (FID/Finance Division), BB, MRA, IDRA, BTRC, BSEC??????Shadow banking framework in placeLowDevelop and adopt a framework for dealing with, and eliminating the adverse impacts of Shadow Banking??????4. Explore the potential ways to introduce ‘Regulatory Sandbox’A regulatory sandbox allows regulators and service providers to test new and innovative services in a safe and secure environmentBenchmark against regional peers and develop a regulatory sandbox framework, including any necessary regulations, to attract players to test innovative products and services for various customer segments including MSMEsBB, BTRC, MRA, IDRA, NFIS Secretariat??????Regulatory sandbox rules / regulations in placeLow5. Devise appropriate ‘incentive structure’ by regulatory bodies for financial service providers to penetrate low-income marketsThere are still pockets of unserved populations especially in rural and remote areas which incentives can help reachDevelop positive (e.g. subsidised funding, tax breaks) and negative (e.g. quotas, targets) incentives to encourage service providers in each sector to penetrate low income markets, directly or through the well positioned MFI and MFS sectorsBB, MRA, IDRA, BSEC, BTRC, NFIS Secretariat??????Incentive scheme for low income / vulnerable populations in placeLow6. Strengthen the capacity of regulatory agencies on data-driven policy analysis and emerging technologies like Fintech, Regtech, Suptech, Insurtech, Artificial Intelligence, DLT, Machine Learning, Augmented Reality, Cyber SecurityThe regulatory agencies must strongly support the adoption of emerging technologies but to do so need adequate capacityDevelop a capacity building plan to strengthen the capacity of regulatory agencies on data-driven policy analysis and emerging technologies (i.e. Fintech, Regtech, Suptech, Insurtech, Artificial Intelligence, DLT, Machine Learning, Augmented Reality, Cyber Security, etc.)NFIS Secretariat, BB, MRA, IDRA, BSEC, BTRC, MoF (FID/Finance Division), A2i, Ministry of Posts, Telecommunications and Information Technology??????Capacity building plan is in placeHighGoal 8: Fortify risk management of financial inclusion initiativesTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241. Ensure proper application of the core principles (set by Bank for International Settlement) for effective banking supervision to the regulation and supervision of institutions relevant to financial inclusionBasel-3 is important for stability, however this needs to be done judiciously to support financial inclusion. The liquidity, leverage and capital requirements could constrain long term credit for enterprises and SME financing optionsAnalyse Basel-3 and its application in Bangladesh, to identify opportunities for the bank sector to better support financial inclusion while still complying with the core principles of Basel-3BB, NFIS Secretariat, MoF (FID/Finance Division), MRA, IDRA, BTRC ??????Potential improvement areas in local application of Basel-3 identifiedHigh2. Take necessary initiatives to balance the Anti-Money Laundering (AML) and Combating Terrorist Financing (CFT) regulations and innovation in financial inclusion drives through ensuring Financial Integrity for reducing the practice of ‘De-risking’Implementation of NFIS-B must go hand-in-hand with financial integrity: de-risking where financial institutions restrict business relationships with clients to avoid, rather than manage risk can drive financial transactions underground to less regulated channels and exclusionEnsure the regulators awareness and capacity to balance AML/CFT regulations with financial inclusion imperatives e.g. attendance at relevant conferences and regular benchmarkingBFIU, BB, MRA, BSEC, IDRA, NFIS Secretariat??????Measures to reduce de-risking are in placeMediumRegulators take the necessary measures where de-risking is identified in the various market sectorsNFIS Secretariat, BB, MRA, BSEC, IDRA, BFIU??????3. Develop framework for assessing risk during financial product developmentA risk assessment framework can ease the process for both regulators and service providers in releasing new productsDevelop and agree on a framework for assessing risk during financial product developmentBB, MRA, BSEC, BTRC, IDRA, BFIU??????Product development risk assessment framework developed and usedMedium4. Develop robust regulatory and supervisory apparatus to protect data privacy and securityCyber security and data privacy has become key concern for the regulators globally. Without sufficient security measures, consumer confidence could impacted and thus sufficient legal shelter for consumers is essentialThe current MFS guidelines need to be revised to more comprehensively address data security, data privacy, customer protection, risk management framework and others to enhance consumer confidence and attract further investmentMoF (FID/Finance Division), BB, A2i, Ministry of Posts, Telecommunications and Information Technology, BTRC, National Identification Wing, Election Commission??????MFS regulations revised to enhance data securityMediumConsider and amend the ICT Act to strengthen data privacy and data security provisions across all sectorsMoICT, BB, MoF (FID/Finance Division)??????Consider and develop a national digital policy, which covers establishment of a national cloud for data storage, guidelines on data management, and vulnerability tests for risk assessmentMoICT, BB??????Goal 9: Strengthen the insurance servicesTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241.????? Develop policy framework Micro-insurance by keeping provision of using MFI linkage to reaching beneficiariesMFIs are well positioned to extend microinsurance services however they are cautious for lack of a clear policy framework. Harmonisation of the MRA Act 2006 and IDRA Law of 2010 could remove such barriers and help expand microinsurance services to the poorIDRA and MRA cooperate to develop a microinsurance policy framework, with provision for: - Harmonisation of the existing Laws - Definition of microinsurance and the target group - Allowance for innovative delivery channels - An advisory committee if neededMoF / FID, IDRA, MRA??????Regulatory environment for microinsurance is clarifiedMediumAmend the Laws and Regulations, or enact a new microinsurance ActMoF / FID, MoLPA IDRA, MRA??????2. Introduce ‘Bancassurance’ to diversify service opportunity to consumersInnovation of blended financial product like bancassurance can help increase penetration of insuranceDevelop a bancassurance framework / regulationMoF / FID, IDRA, BB??????Bancassurance framework developedLow3. Introduce innovative insurance products for marginal people, small business and agriculture like weather based crop insurance, health insurance for low income peopleInsurance could be a useful product to increase resilience of marginal people, however the business case is often difficult and requires careful designExplore and implement pilots for innovative insurance products targeted at marginal people, small businesses and agriculture, including weather based crop insurance and health insurance for low income peopleNFIS Secretariat, IDRA, MRA, BIA, MoAg, MSW, MoH??????# of insurance products developed for marginal groupsMediumGoal 10: Reinforce the capital market servicesTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241. Deepen the capital market to expand the participation of individuals and businesses and introduce a wider range of financial instruments for investmentCapital markets are yet to serve the underserved segments - due to absence of an active bond market, lack of widespread credit scoring for CMSMEs, and lack of capital market instrumentsEngage with providers of, and put in place measures to encourage development of new financial instruments for investmentMoF (FID/Finance Division), BSEC??????# of new investment productsMedium2. Expand the scope of usage alternatives investments like venture capital, impact fund, AIF, SPV for CMSME finance, agricultural finance and green finance at remote rural levelAlternative investment mechanisms will widen the sources of finance available to CMSMEs; these need to include targeted instruments (a.g. agricultural and green finance)Revisit the BSEC Alternative Investment Rules of 2015, to include additional mechanisms such as AIF, impact funds, and special purpose vehiclesBSEC, MoF (FID), BB, MRA, venture capital companies, SME foundation, Ministry of Agriculture, Ministry of Industry and Commerce, ??????Value of alternative investment marketLowEngage with providers of, and put in place measures to encourage development of new alternative investment productsBSEC??????3. Develop bond market to facilitate risk-averse retail and small investorsAn active bond market will provide new opportunities for risk averse retail clients; current this option does not existDevelop guidelines for bond financing and the bond market; and support providers to develop appropriate products and practicesBSEC, MoF / FID??????Active bond market in placeMediumGoal 11: Fortify Micro finance servicesTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241. Increase the access to diverse source of fund by MFIsMFIs are in need of additional funding to reach deeper into the market, i.e. larger loans and more customers, and thus measures are needed to ease access to financeRevise MFI borrowing rules and regulations to streamline borrowing especially from international sourcesBB, MRA, MoF (FID/Finance Division), MFIs??????# of streamlined / new lines of borrowing for MFIsMediumIssue the necessary regulations, guidelines or directives on how MFIs can issue bonds in the bond marketBSEC, MRA, MoF (FID/Finance Division), MFIs??????Consider and amend the MRA Rules of 2006 to allow MFIs to collect deposits from the public, and to create a framework for transformation into microfinance banksMRA, BB, MoF (FID/Finance Division), MFIs??????Consider and introduce new MFI wholesale lenders such as PKSF, or expand existing ones, to expand access to finance opportunities for MFIsMoF / FID, PKSF, NFIS Secretariat??????2. Initiate ‘digitization’ of relatively small scale MFIs to increase their efficiencyDigitization of MFIs will enhance efficiency and reach in the sector; however customers may struggle with digital products and time is neededEngage with smaller MFIs to define an appropriate timeline for digitization of various aspects of their operations, starting with internal operationsMoF (FID/Finance Division), MRA, MFIs??????% of MFIs that have digitized operationsMediumProvide funding for smaller MFIs to digitize their operationsNFIS Secretariat, MoF (FID/Finance Division), PKSF, MRA, MFIs, MFS providers ??????Goal 12: Strengthen Quasi-Regulated Financial Service ProvidersTargetsExpected ResultActivitiesLead & support institutionsTimelineIndicatorsPriority2019202020212022202320241. Strengthen Quasi-Regulated Financial Service Providers to facilitate their financial services by complying applicable regulatory requirements.Quasi regulated financial service providers play a crucial role in extending financial inclusion; yet in some cases they are under utilised, or could be strengthened especially in regard to regulatory compliancePerform diagnostics of, and develop a strategy to strengthen Quasi-Regulated Financial Service Providers including BPO, BHBFC, BMDF, PKSF, Samabay Bank, Ekti Bari Ekti Khamar and Palli Sanchay Bank to facilitate their financial services by complying applicable regulatory requirements.MoF ( FID), BPO, BHBFC, BMDF, PKSF, Samabay Bank, Ekti Bari Ekti Khamar and Palli Sanchay Bank ??????Necessary reforms identified and implemented per institutionLowAnnexure 7: Priority Actions of Bangladesh Bank and MinistriesBBMinistriesCombinedGoalsTargetsHigh priority Moderate priority High priority Moderate priority PriorityScore1.?? Increase financial deepening1.Introduce e-KYC for all types of bank accounts, MFS accounts and other regulated financial services account1173High202.Revisit the KYC requirement for cottage and micro enterprises, micro-merchant/retails businesses and low-income households.??12Low43.Ensure the access of all regulated financial service providers to ‘National ID database’ of Election Commission and ‘Biometric Database’ of Bangladesh Telecommunication Regulatory Commission2142High154.Introduce the framework for ‘socially responsible financing’1?22Medium85.Expand the scope and practice of ‘Cluster’ and ‘Value Chain’ financing.2???Low46.Take necessary initiatives for making account opening process as optimally simple and convenient for all??21Low57.Develop framework for diversifying financing instruments and financing options for CMSMEs and low-income households1221Medium98.Take necessary actions to reduce fiscal burden on the usage of financial services for consumers specially in DFS??21Low59.Establish Micro-Finance Credit Information Bureau (CIB), Collateral (both movable and immovable) Registry Bureau for financial services and upgrade the existing CIB under Bangladesh Bank into full fledged ‘Credit Registry’3?31Medium1310.??????? Introduce the usage of artificial intelligence and machine learning for credit scoring and monitoring through big data analysis1?21Medium711.??????? Introduce ‘Credit Guarantee Fund’ for CMSME finance, agricultural finance and green finance1121Medium812.??????? Take necessary initiatives for developing refinancing mechanism for funding ‘Start-ups’2233High1513.??????? Make required arrangement for facilitating smooth inward remittance of domestic professionals on Business Process Outsourcing and NRBs1111Low614.??????? Formulate policy framework for Micro-savings by BB and MRA1??1Low315.??????? Explore the feasibility to introduce 'P2P Lending' and 'Crowd Funding'1???Low216.??????? Create mechanisms of robust information sharing for convenient client on-boarding?1??Low12. Strengthen payment system and service delivery channel17.??????? Ensure interoperability within all MFS accounts??2?Low418.??????? Ensure interoperability within all MFS and bank accounts2?3?Medium1019.??????? Ensure the transformation of all branches of all banks into online branches1?3?Medium820.??????? Ensure the participation of all banks in interbank Automated Teller Machines (ATM), Point of Sales (POS) and Internet Banking Fund Transfer (IBFT)??2?Low421.??????? Establish a ‘Payment System Coordination Council’ consisting of relevant regulatory bodies???1Low122.??????? Bring all types of Government payments (P2G and G2P) including social security payments under financial services (either bank account or MFS account)1?22Medium823.??????? Take necessary initiatives to digitize ‘Micro-Merchant Payments’ and ‘Retail Transport Payment’1???Low224.??????? Enhance the scope of MFI linkage for providing banking and MFS services??21Low525.??????? Enhance the scope of financial service providing by PSPs??11Low326.??????? Initiate the formulation of National Payment Act1?3?Medium827.??????? Assess the feasibility of establishing payment bank??1?Low23 Establish robust Data and Measurement framework1.????? Conduct a comprehensive country-wide demand side survey to appropriately assess the financial service11??Low32.????? Establish a set of globally comparable national financial inclusion indicators in light of World Bank Findex, IMF Financial Access Survey and G20 Financial Inclusion Indicators2?2?Medium83.????? Ensure the collection of comprehensive and quality financial inclusion data disaggregated by sex, age, location and other aspects ?1?2Low34.????? Create robust and automated Management Information System and dedicated web-portal for NFIS-B data like SDG Tracker?13?Medium75.????? Explore the potential ways for using ‘Cloud Solutions’ to store and preserve data by Financial Service Provider and Regulatory Agencies111?Low56.????? Strengthen the capacity of statistical agency for national financial inclusion data??1?Low24. Promote Financial Literacy and Consumer Empowerment1.????? Formulate Financial Literacy Policy/Strategy by all financial sector regulatory bodies separately4?52High202. Formulate Consumer Protection Framework and Grievance Redressal System by all financial sector regulatory bodies separately1144High153. All regulated financial service provider will have annual program on financial literacy which will be monitored by respective regulatory body???2Low24. Take necessary initiatives with Ministry of Education to incorporate ‘Financial Literacy’ at all levels of education (Primary, Secondary, Tertiary)1131Medium105. Assess the feasibility of introducing consumer protection mechanism similar to ‘Deposit Insurance Scheme’ for banks??2?Low45. Broaden and Deepen Financial Inclusion of Women, Population affected by Climate Change and other underserved segment of population1. Develop separate policy/strategy and undertake special programs by all regulatory bodies of financial sector on women financial inclusion covering the issues below:a)????? Dedicated focus on catering the need financial services (saving, credit, payment, investment and insurance) of women individuals and entrepreneurs from both rural and urban areasb)????? Convenient service delivery channel for womenc)????? Separate focus for women in DFS3?61High192. Formulate target based specific policies and initiate dedicated programs by IDRA, BSEC and MRA as well as relevant government agencies on Financial Inclusion and Climate Change along with the reinforcing BB’s initiatives2116Medium133. Formulate target based specific policies and initiate dedicated programs by all regulatory bodies and relevant government agencies on following aspects of financial inclusion separately:?? Youth Financial Inclusion?? Financial Inclusion for Physically Challenged People?? Financial Inclusion for Third Gender?? Financial Inclusion for Children?? Financial Inclusion for Bangladeshi Diaspora/Non Resident Bangladeshi (NRBs)?? Financial Inclusion for extremely destitute and underprivileged people like tea labors, floating communities, urban slum dwellers, poor people in remote hilly, forest, coastal, haor, char with difficult terrain and similar areas; former enclave areas, sparsely populated areas and relatively underdeveloped areas with poor infrastructure1132Medium116. Upscale Digital Financial Services and Fintech1. Formulate a DFS strategy2?5?High142. Ensure the usage of DFS in all types of utility services (water, gas, electricity, internet, health, education and others) payments 2??2Low63. Assess the feasibility of application of Distributed Ledger Technology (DLT) in financial sector??1?Low24. Explore the potential modalities to introduce credit service and full deposit service for MFS account holders1???Low25. Explore the potential solutions to provide all banking services at full scale in outlet level under agent banking?111Low46. Assess the potential scope of application of Fintech, Regtech, Suptech, Insurtech?211Low57.Strengthen the policy and regulatory environment1. Coordinate across Ministries, Regulatory Bodies and relevant government agencies for implementation of NFIS-B224?High142. Establish the practice of evidence based policy making????Low03. Reinforce the coordination and coherent effort to refrain illegal financial services and eliminate the adverse impacts of Shadow Banking????Low04. Explore the potential ways to introduce ‘Regulatory Sandbox’?1??Low15. Devise appropriate ‘incentive structure’ by regulatory bodies for financial service providers to penetrate low-income markets????Low06.Strengthen the capacity of regulatory agencies on data-driven policy analysis and emerging technologies like Fintech, Regtech, Suptech, Insurtech, Artificial Intelligence, DLT, Machine Learning, Augmented Reality, Cyber Security1243High158. Fortify risk management of financial inclusion initiatives1. Ensure proper application of the core principles (set by Bank for International Settlement) for effective banking supervision to the regulation and supervision of institutions relevant to financial inclusion314?High152. Take necessary initiatives to balance the Anti-Money Laundering (AML) and Combating Terrorist Financing (CFT) regulations and innovation in financial inclusion drives through ensuring Financial Integrity for reducing the practice of ‘De-risking’2?41Medium133. Develop framework for assessing risk during financial product development?122Medium74. Develop robust regulatory and supervisory apparatus to protect data privacy and security??44Medium129. Strengthen the insurance services1.????? Develop policy framework Micro-insurance by keeping provision of using MFI linkage to reaching beneficiaries1?41Medium112. Introduce ‘Bancassurance’ to diversify service opportunity to consumers??11Low33. Introduce innovative insurance products for marginal people, small business and agriculture like weather based crop insurance, health insurance for low income people?132Medium910 Reinforce the capital market servicesDeepen the capital market to expand the participation of individuals and businesses and introduce a wider range of financial instruments for investment?13?Medium72. Expand the scope of usage alternatives investments like venture capital, impact fund, AIF, SPV for CMSME finance, agricultural finance and green finance at remote rural level1?1?Low43. Develop bond market to facilitate risk-averse retail and small investors?32?Medium711. Fortify Micro finance services1. Increase the access to diverse source of fund by MFIs??4?Medium82. Initiate ‘digitization’ of relatively small scale MFIs to increase their efficiency?131Medium8Annexure 8: Compatibility Analysis of SDG and NFIS-B TargetsGoalsNFIS-B TargetsSDG TargetsIncrease financial deepeningImplement e-KYC for all types of bank accounts, MFS accounts and other regulated financial services accountRevisit the KYC requirement for cottage and micro enterprises, micro-merchant/retails businesses and low-income households.Ensure the access of all regulated financial service providers to ‘National ID’ of Election Commission Introduce the framework for ‘socially responsible financing’Expand the scope and practice of ‘Cluster’ and ‘Value Chain’ financing.Take necessary initiatives for making account opening process as optimally simple and convenient for allDevelop framework for diversifying financing instruments and financing options for CMSMEs and low-income householdsTake necessary actions to reduce fiscal burden on the usage of financial services for consumers specially in DFSEstablish Micro-Finance Credit Information Bureau (CIB), Collateral (both movable and immovable) Registry Bureau for financial services and upgrade the existing CIB under Bangladesh Bank into full-fledged ‘Credit Registry’Introduce the usage of artificial intelligence and machine learning for credit scoring and monitoring through big data analysisIntroduce ‘Credit Guarantee Fund’ for CMSME finance, agricultural finance and green financeTake necessary initiatives for developing refinancing mechanism for funding ‘Start-ups’Make required arrangement for facilitating smooth inward remittance of domestic professionals based in Bangladesh on Business Process Outsourcing, Freelance outsourcing, NRBs/Diaspora and Overseas migrant workers Formulate policy framework for Micro-savings by BB and MRAExplore the feasibility to introduce 'P2P Lending' and 'Crowd Funding'Create structure of robust information sharing for convenient client on-boardingSDG 1(1.4): By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership and control over land and other forms of property, inheritance, natural resources, appropriate new technology and financial services, including micro finance.SDG 8 (8.3): Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises, including through access to financial services. SDG 9 (9.3): Increase the access of small-scale industrial and other enterprises, in particular in developing countries, to financial services, including affordable credit, and their integration into value chains and markets.SDG 9 (9.b): Support domestic technology development, research and innovation in developing countries, including by ensuring a conducive policy environment for, inter alia, industrial diversification and value addition to commodities.SDG 10 (10.c): By 2030, reduce to less than 3 per cent the transaction costs of migrant remittances and eliminate remittance corridors with costs higher than 5 per cent.SDG 17 (17.11): Significantly increase the exports of developing countries, in particular with a view to doubling the least developed countries’ share of global exports by 2020Strengthen payment system and service delivery channelEnsure interoperability within all MFS accountsEnsure interoperability within all MFS accounts, bank accounts and e-wallets (Digital wallets).Ensure the transformation of all branches of all banks into online branches.Ensure the participation of all banks in interbank Automated Teller Machines (ATM), Point of Sales (POS) and Internet Banking Fund Transfer (IBFT)Establish a ‘Payment System Coordination Committee’ consisting of relevant regulatory bodiesBring all types of Government payments (P2G and G2P) including social security payments and all types of B2P and P2B payments under electronic financial services account (e.g. through bank account or MFS account or postal account)Take necessary initiatives to digitize ‘Micro-Merchant Payments’ and ‘Retail Transport Payment’Enhance the scope of MFI linkage for providing banking and MFS servicesEnhance the scope of financial service providing by PSPsInitiate the formulation of National Payment ActAssess the feasibility of establishing payment bankImplement ‘Digital Signature’ to ensure security of any electronic TransactionPrepare framework to conduct regular vulnerability and penetration testing for the payment system SDG 17 (17.1): Strengthen domestic resource mobilization, including through international support to developing countries, to improve domestic capacity for tax and other revenue collection.Establish robust Data and Measurement frameworkConduct a comprehensive country-wide demand side survey to appropriately assess the financial serviceEstablish a set of globally comparable national financial inclusion indicators in light of World Bank Findex, IMF Financial Access Survey and G20 Financial Inclusion Indicators.Ensure the collection of comprehensive and quality financial inclusion data disaggregated by sex, age, location and other aspects Create robust and automated Management Information System and dedicated web-portal for NFIS-B data like SDG TrackerExplore the potential ways for using ‘Cloud Solutions’ to store and preserve data by Financial Service Provider and Regulatory AgenciesStrengthen the capacity of statistical agency for national financial inclusion data.SDG 9 (9.c): Significantly increase access to information and communications technology and strive to provide universal and affordable access to the Internet in least developed countries by 2020.SDG 17 (17.16): Enhance the global partnership for sustainable development, complemented by multi-stakeholder partnerships that mobilize and share knowledge, expertise, technology and financial resources, to support the achievement of the sustainable development goals in all countries, in particular developing countries.SDG 17 (17.18): By 2020, enhance capacity-building support to developing countries, including for least developed countries and small island developing States, to increase significantly the availability of high-quality, timely and reliable data disaggregated by income, gender, age, race, ethnicity, migratory status, disability, geographic location and other characteristics relevant in national contexts.SDG 17 (17.19): By 2030, build on existing initiatives to develop measurements of progress on sustainable development that complement gross domestic product, and support statistical capacity-building in developing countries.Promote Financial Literacy and Consumer EmpowermentFormulate Financial Literacy Policy/Strategy by all financial sector regulatory bodies separatelyFormulate Consumer Protection Framework and Grievance Redressal System by all financial sector regulatory bodies separatelyAll regulated financial service provider will have annual program on financial literacy which will be monitored by respective regulatory bodyTake necessary initiatives with Ministry of Education to incorporate ‘Financial Literacy’ at all levels of education (Primary, Secondary, Tertiary)Assess the feasibility of introducing consumer protection mechanism similar to ‘Deposit Insurance Scheme’ for banksSDG 4 (4.6): Ensure that all youth and a substantial proportion of adults, both men and women, achieve literacy and numeracy.SDG 4 (4.7): Ensure that all learners acquire the knowledge and skills needed to promote sustainable development, including, among others, through education for sustainable development and sustainable lifestyles, human rights, gender equality, promotion of a culture of peace and non-violence, global citizenship and appreciation of cultural diversity and of culture’s contribution to sustainable development.Broaden and Deepen Financial Inclusion of Women, Population affected by Climate Change and other underserved segment of population and senior citizenDevelop separate policy/strategy and undertake special programs by all regulatory bodies of financial sector on women financial inclusion covering the issues below:Dedicated focus on catering the need financial services (saving, credit, payment, investment and insurance) of women individuals and entrepreneurs from both rural and urban areasConvenient service delivery channel for womenSeparate focus for women in DFSFormulate target based specific policies and initiate dedicated programs by IDRA, BSEC and MRA as well as relevant government agencies on Financial Inclusion and Climate Change along with the reinforcing BB’s initiativesFormulate target based specific policies and initiate dedicated programs by all regulatory bodies and relevant government agencies on following aspects of financial inclusion separately:Youth Financial InclusionFinancial Inclusion for Physically Challenged PeopleFinancial Inclusion for Third GenderFinancial Inclusion for Children including the ones with special needFinancial Inclusion for Old Age and Retired PersonsFinancial Inclusion for Bangladeshi Overseas Migrant Workers/Diaspora/Non Resident Bangladeshi (NRBs)Financial Inclusion for extremely destitute and underprivileged people like tea labors, floating communities, urban slum dwellers, poor people in remote hilly, forest, coastal, haor, char with difficult terrain and similar areas; former enclave areas, sparsely populated areas and relatively underdeveloped areas with poor infrastructureSDG 1 (1.5): By 2030, build the resilience of the poor and those in vulnerable situations and reduce their exposure and vulnerability to climate-related extreme events and other economic, social and environmental shocks and disasters.SDG 1 (1.b): Create sound policy frameworks at the national, regional and international levels, based on pro-poor and gender-sensitive development strategies, to support accelerated investment in poverty eradication actionsSDG 5 (5.a): Undertake reforms to give women equal rights to economic resources, as well as access to ownership and control over land and other forms of property, financial services, inheritance and natural resources, in accordance with national laws.SDG 4 (4.4): Substantially increase the number of youth and adults who have relevant skills, including technical and vocational skills, for employment, decent jobs and entrepreneurship.SDG 4 (4.5): Eliminate gender disparities in education and ensure equal access to all levels of education and vocational training for the vulnerable, including persons with disabilities, indigenous peoples and children in vulnerable situations.SDG 8 (8.b): By 2020, develop and operationalize a global strategy for youth employment and implement the Global Jobs Pact of the International Labour Organization.SDG 10 (10.2): Empower and promote the social, economic and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion or economic or other status.SDG 11 (l1.b): By 2020, substantially increase the number of cities and human settlements adopting and implementing integrated policies and plans towards inclusion, resource efficiency, mitigation and adaptation to climate change, resilience to disasters, and develop and implement, in line with the Sendai Framework for Disaster Risk Reduction 2015-2030, holistic disaster risk management at all levels.SDG 13 (13.1): Strengthen resilience and adaptive capacity to climate-related hazards and natural disasters in all countries.SDG 13 (13.2): Integrate climate change measures into national policies, strategies and planning.SDG 13 (13.3): Improve education, awareness-raising and human and institutional capacity on climate change mitigation, adaptation, impact reduction and early warning. SDG 13 (13.a): Implement the commitment undertaken by developed-country parties to the United Nations Framework Convention on Climate Change to a goal of mobilizing jointly $100 billion annually by 2020 from all sources to address the needs of developing countries in the context of meaningful mitigation actions and transparency on implementation and fully operationalize the Green Climate Fund through its capitalization as soon as possible. SDG 13 (13.b): Promote mechanisms for raising capacity for effective climate change-related planning and management in least developed countries and small island developing States, including focusing on women, youth and local and marginalized communities.SDG 15 (15.a): Mobilize and significantly increase financial resources from all sources to conserve and sustainably use biodiversity and ecosystems.Upscale Digital Financial Services and FintechFormulate a DFS strategyEnsure the usage of DFS in all types of utility services (water, gas, electricity, internet, health, education and others) payments Assess the feasibility of application of Distributed Ledger Technology (DLT) in financial sectorExplore the potential modalities to introduce credit service and full deposit service for MFS account holdersExplore the potential solutions to provide all banking services at full scale in outlet level under agent bankingAssess the potential scope of application of Fintech, Regtech, Suptech, InsurtechSDG 5 (5.b): Enhance the use of enabling technology, in particular information and communications technology, to promote the empowerment of women.SDG 8 (8.2): Achieve higher levels of economic productivity through diversification, technological upgrading and innovation, including through a focus on high-value added and labor-intensive sectors.SDG 8 (8.5): Achieve full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value.SDG 8 (8.6): Substantially reduce the proportion of youth not in employment, education or training.SDG 17 (17.8): Fully operationalize the technology bank and science, technology and innovation capacity-building mechanism for least developed countries by 2017 and enhance the use of enabling technology, in particular information and communications technology.Strengthen the policy and regulatory environmentCoordinate across Ministries, Regulatory Bodies and relevant government agencies for implementation of NFIS-BEstablish the practice of evidence-based policy makingReinforce the coordination and coherent effort to refrain illegal financial services and eliminate the adverse impacts of Shadow BankingExplore the potential ways to introduce ‘Regulatory Sandbox’Devise appropriate ‘incentive structure’ by regulatory bodies for financial service providers to penetrate low-income marketsStrengthen the capacity of regulatory agencies on data-driven policy analysis and emerging technologies like Fintech, Regtech, Suptech, Insurtech, Artificial Intelligence, DLT, Machine Learning, Augmented Reality, Cyber SecuritySDG 10 (10.5): Improve the regulation and monitoring of global financial markets and institutions and strengthen the implementation of such regulations.SDG 17 (17.14): Enhance policy coherence for sustainable development.SDG 17 (17.15): Respect each country’s policy space and leadership to establish and implement policies for poverty eradication and sustainable development.Fortify risk management of financial inclusion initiativesEnsure proper application of the core principles (set by Bank for International Settlement) for effective banking supervision to the regulation and supervision of institutions relevant to financial inclusionTake necessary initiatives to balance the Anti-Money Laundering (AML) and Combating Terrorist Financing (CFT) regulations and innovation in financial inclusion drives through ensuring Financial Integrity for reducing the practice of ‘De-risking’Develop framework for assessing risk during financial product developmentDevelop robust regulatory and supervisory apparatus to protect data privacy and security including cyber security and establish a coordinated platform among regulatory agencies, task forces and law enforcing agencies with a view to safeguarding and executing forensic tasks against cyber threat.SDG 8 (8.10): Strengthen the capacity of domestic financial institutions to encourage and expand access to banking, insurance and financial services for all.Strengthen the insurance servicesDevelop policy framework Micro-insurance by keeping provision of using MFI linkage to reaching beneficiariesIntroduce ‘Bancassurance’ to diversify service opportunity to consumersIntroduce innovative insurance products for marginal people, small business and agriculture like weather-based crop insurance, livestock insurance, fisheries insurance with GPS tracking, health insurance for low income people, autistic people and pension scheme for old age retired peopleDevelop framework for automation of insurance sectorSDG 3 (3.8): Achieve universal health coverage, including financial risk protection, access to quality essential health-care services and access to safe, effective, quality and affordable essential medicines and vaccines for all.SDG 3 (3.d): Strengthen the capacity of all countries, in particular developing countries, for early warning, risk reduction and management of national and global health risks.SDG 8 (8.10): Strengthen the capacity of domestic financial institutions to encourage and expand access to banking, insurance and financial services for all. Reinforce the capital market servicesDeepen the capital market to expand the participation of individuals and businesses and introduce a wider range of financial instruments for investmentExpand the scope of usage alternatives investments like venture capital fund, impact fund, other AIF, SPV for CMSME finance, agricultural finance and green finance at remote rural level through appropriate capital market instrumentsDevelop bond market to facilitate risk-averse retail and small investorsSDG 2 (2.3): Double the agricultural productivity and incomes of small-scale food producers, in particular women, indigenous peoples, family farmers, pastoralists and fishers, including through secure and equal access to land, other productive resources and inputs, knowledge, financial services, markets and opportunities for value addition and non-farm employment.SDG 2 (2.4): Ensure sustainable food production systems and implement resilient agricultural practices that increase productivity and production, that help maintain ecosystems, that strengthen capacity for adaptation to climate change, extreme weather, drought, flooding and other disasters and that progressively improve land and soil qualityFortify Micro finance servicesIncrease the access to diverse source of fund by MFIsInitiate ‘digitization’ of relatively small-scale MFIs to increase their efficiencySDG 1 (1.4): By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership and control over land and other forms of property, inheritance, natural resources, appropriate new technology and financial services, including micro finance.SDG 8 (8.3): Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro, small and medium-sized enterprises, including through access to financial services.SDG 17 (17.3): Mobilize additional financial resources for developing countries from multiple sources.Strengthen Quasi-Regulated Financial Service Providers like BPO, BHBFC, BMDF, PKSF, Samabay Bank, Ekti Bari Ekti Khamar and Palli Sanchay Bank, ICB and other relevant government agencies to facilitate their financial services by complying applicable regulatory requirements. Annexure 9: Goal and target wise additional resource requirements (in million BDT at constant 2018/19 prices)?20202021202220232024TotalGoal -1: Increase Financial Deepening1.Introduce e-KYC for all types of bank accounts, MFS accounts and other regulated financial services account 35006000550045006000?2.Revisit the KYC requirement for cottage and micro enterprises, micro-merchant/retails businesses and low-income households.70015001550160040003.Ensure the access of all regulated financial service providers to ‘National ID database’ of Election Commission and ‘Biometric Database’ of Bangladesh Telecommunication Regulatory Commission120018401880190024004.Introduce the framework for ‘socially responsible financing’ 10001450165019002500?5.Expand the scope and practice of ‘Cluster’ and ‘Value Chain’ financing. 17502850290030003800?6. Take necessary initiatives for making account opening process asoptimally simple and convenient for all2506006659501600?7.Develop framework for diversifying financing instruments and financing options for CMSMEs and low-income households 15002700290030005000?8.Take necessary actions to reduce fiscal burden on the usage of financial services for consumers specially in DFS3256006447001300?9.Establish Micro-Finance Credit Information Bureau (CIB), Collateral (both movable and immovable) Registry Bureau for financial services and upgrade the existing CIB under Bangladesh Bank into full fledged ‘Credit Registry’ 20003300340035004800?10. Introduce the usage of artificial intelligence and machine learning for credit scoring and monitoring through big data analysis 11800240025002600340011. Introduce ‘Credit Guarantee Fund’ for CMSME finance, agricultural finance and green finance 2700530056005700780012.Take necessary initiatives for developing refinancing mechanism for funding ‘Start-ups’ 450750875900140013. Make required arrangement for facilitating smooth inward remittance of domestic professionals on Business Process Outsourcing and NRBs 300500650721125714.Formulate policy framework for Micro-savings by BB and MRA 450500575615138015. Explore the feasibility to introduce 'P2P Lending' and 'Crowd Funding' 800135014001500220016. Create mechanisms of robust information sharing for convenient client on-boarding40082595010501500Total cost for Goal-11912532465336393413650337169702Goal -2: Strengthen Payment System and Service Delivery Channel1. Ensure interoperability within all MFS accounts450874965100014002. Ensure interoperability within all MFS and bank accounts65014001500170025003. Ensure the transformation of all branches of all banks into online branches120031003200430068004. Ensure the participation of all banks in interbank Automated Teller Machines (ATM), Point of Sales (POS) and Internet Banking Fund Transfer (IBFT)95015501600190036005. Establish a "Payment System Coordination Council" consisting of relevant regulatory bodies45011001200130020006. Bring all types of Government payments (P2G and G2P) including social security payments under financial services (either bank account or MFS account)5005506507508007. Take necessary initiatives to digitize "Micro-Merchant Payments” and "Retail Transport Payment”4456006507759758. Enhance the scope of MFI linkage for providing banking and MFS services200030002800250030009. Enhance the scope of financial service providing by PSPs50095010001150160010. Initiate the formulation of National Payment Act500105011001200150011. Assess the feasibility of establishing payment bank400475500550700Total cost for Goal-280451464915165171252487579859Goal -3: Establish robust Data and Measurement framework1. Conduct a comprehensive country-wide demand side survey to appropriately assess the financial service25052555060010002.????? Establish a set of globally comparable national financial inclusion indicators in light of World Bank Findex, IMF Financial Access Survey and G20 Financial Inclusion Indicators 2004354504507003. Ensure the collection of comprehensive and quality financial inclusion data disaggregated by sex, age, location and other aspects3004504755006754. Create robust and automated Management Information System anddedicated web-portal for NFIS-B data like SDG Tracker65011001175120016005.?Explore the potential ways for using ‘Cloud Solutions’ to store and preserve data by Financial Service Provider and Regulatory Agencies2504805205508006. Strengthen the capacity of statistical agency for national financial inclusion data65092597010001500Total cost for Goal-32300391541404300627520930Goal -4: Promote Financial Literacy and Consumer Empowerment1. Formulate Financial Literacy Policy/Strategy by all financial sector regulatory bodies separately 70013001375140020002. Formulate Consumer Protection Framework and Grievance Redressal System by all financial sector regulatory bodies separately 1460925975100012503. All regulated financial service provider will have annual program on financial literacy which will be monitored by respective regulatory body75012001250130018004. Take necessary initiatives with Ministry of Education to incorporate ‘Financial Literacy’ at all levels of education (Primary, Secondary, Tertiary) 160026752700275038505. Assess the feasibility of introducing consumer protection mechanism similar to "Deposit Insurance Scheme" for banks150325350400600Total cost for Goal-43660642566506850950033085Goal 5: Broaden and Deepen Financial Inclusion of Women, Population affected by Climate Change and other underserved segment of population1. Develop separate policy/strategy and undertake special programs by all regulatory bodies of financial sector on women financial inclusion covering the issues below: a)????? Dedicated focus on catering the need financial services (saving, credit, payment, investment and insurance) of women individuals and entrepreneurs from both rural and urban areas b)????? Convenient service delivery channel for women c)???? Separate focus for women in DFS 12001750180017002800?2. Formulate target based specific policies and initiate dedicated programs by IDRA, BSEC and MRA as well as relevant government agencies on Financial Inclusion and Climate Change along with the reinforcing BB’s initiatives 6501150120012501700?3. Formulate target based specific policies and initiate dedicated programs by all regulatory bodies and relevant government agencies on following aspects of financial inclusion separately: ? Youth Financial Inclusion? Financial Inclusion for Physically Challenged People? Financial Inclusion for Third Gender? Financial Inclusion for Children? Financial Inclusion for Bangladeshi Diaspora/Non ResidentBangladeshi (NRBs)? Financial Inclusion for extremely destitute and underprivilegedpeople like tea labors, floating communities, urban slum dwellers,poor people in remote hilly, forest, coastal, haor, char with difficultterrain and similar areas; former enclave areas, sparsely populatedareas and relatively underdeveloped areas with poor infrastructure500095008000800012500Total cost for Goal-568501240011000109501700058200Goal -6: Upscale Digital Financial Services and Fintech1. Formulate a DFS strategy 40077580082512002. Ensure the usage of DFS in all types of utility services (water, gas, electricity, internet, health, education and others) payments 40010501100117515503. Assess the feasibility of application of Distributed Ledger Technology (DLT) in financial sector2504254505508504. Explore the potential modalities to introduce credit service and full deposit service for MFS account holders 4009501000120018005. Explore the potential solutions to provide all banking services at full scale in outlet level under agent banking650850900100017506. Assess the potential scope of application of Fintech, Regtech, Suptech, Insurtech10003150320033004000Total cost for Goal-631007200745080501115036950Goal -7: Strengthen the policy and regulatory environment1. Coordinate across Ministries, Regulatory Bodies and relevant government agencies for implementation of NFIS-B70015001560160035002. Establish the practice of evidence based policy making4509501000110016003. Reinforce the coordination and coherent effort to refrain illegal financial services and eliminate the adverse impacts of Shadow Banking400850900105019004. Explore the potential ways to introduce "Regulatory Sandbox"40080087090016005. Devise appropriate "incentive structure" by regulatory bodies for financial service providers to penetrate low-income markets80014751500155023006.Strengthen the capacity of regulatory agencies on data-driven policy analysis and emerging technologies like Fintech, Regtech, Suptech, Insurtech, Artificial Intelligence, DLT, Machine Learning, Augmented Reality, Cyber Security 30006300640065008500Total cost for Goal-757501187512230127001940061955Goal -8: Fortify risk management of financial inclusion initiatives1. Ensure proper application of the core principles (set by Bank for International Settlement) for effective banking supervision to the regulation and supervision of institutions relevant to financial inclusion 80018501900200025002. Take necessary initiatives to balance the Anti-Money Laundering (AML) and Combating Terrorist Financing (CFT) regulations and innovation in financial inclusion drives through ensuring Financial Integrity for reducing the practice of ‘De-risking’ 40077580070010003. Develop framework for assessing risk during financial product development . 3005004753507504. Develop robust regulatory and supervisory apparatus to protect data privacy and security2505255506001200Total cost for Goal-81750365037253650545018225Goal -9: Strengthen the insurance services1. Develop policy framework Micro-insurance by keeping provision of using MFI linkage to reaching beneficiaries80015251550160024002. Introduce ‘Bancassurance’ to diversify service opportunity to consumers400900950100015003. Introduce innovative insurance products for marginal people, smallbusiness and agriculture like weather based crop insurance, healthinsurance for low income people15002550280028003500Total cost for Goal-92700497553005400740025775Goal -10: Reinforce the capital market services1. Deepen the capital market to expand the participation of individualsand businesses and introduce a wider range of financial instruments forinvestment70018001500100025002. Expand the scope of usage alternatives investments like venturecapital, impact fund, AIF, SPV for CMSME finance, agricultural financeand green finance at remote rural level120020002100200022003. Develop bond market to facilitate risk-averse retail and smallinvestors4508507505501200Total cost for Goal-102350465043503550590020800Goal -11: Fortify Micro finance services1. Increase the access to diverse source of fund by MFIs95017501800162526002. Initiate ‘digitization’ of relatively small scale MFIs to increase theirefficiency10501500155016503500Total cost for Goal-112000325033503275610017975Goal-12: Strengthen Quasi-Regulated Financial Service Providers1. Strengthen Quasi-Regulated Financial Service Providers like BPO, BHBFC, BMDF, PKSF, Samabay Bank, Ekti Bari Ekti Khamar and Palli Sanchay Bank, ICB and other relevant government agencies to facilitate their financial services by complying applicable regulatory requirements. 23006200440047757300Total cost for Goal-122300620044004775730024975Human Resource Plan100010001200120010005400Total requirements (in million Tk.)60930112654112599115961171687573831 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download