Published: 27 May 2025
Study Background
Mobile Financial Services (MFS) refers to financial transactions made using mobile phone number, including payments, transfers and banking services, where the records of all transactions are preserved in a digital system. The MFS services were initiated in Bangladesh in 2011 with the purpose of promoting access to formal financial services at an affordable cost, especially for the unbanked marginalised population, including women, ensuring fast financial transactions, and reducing use of cash and its associated cost. The Payment Systems Department (PSD) of Bangladesh Bank is the regulatory and licensing authority of the MFS sector. It provides license to MFS Providers (MFSP) under the provision of ‘Bangladesh Mobile Financial Services (MFS) Regulations, 2022’. Moreover, Bangladesh Financial Intelligence Unit (BFIU), Bangladesh Telecommunication Regulatory Commission (BTRC), and the Office of the Register of the Joint Stock Companies and Firms (RJSC) are key stakeholders with significant supervisory and regulatory roles in this sector. At present, 13 Mobile Financial Services Providers (MFSPs) are continuing their operations. According to a report of Bangladesh Bank, as of December 2024, the total number of MFS account holders (registered customers) is about 237 million (58.4% male and 41.6% female), of which 37.6% are active accounts. The number of merchant accounts is 1.54 million. In addition, this sector creates a significant number of employment opportunities. According to Bangladesh Bank, a total of 1.83 million agents are working in this sector. The average transaction per month is BDT 1647.4 billion, and the daily average is BDT 53.14 billion.
Financial transactions through MFS are increasing due to their diverse services, ease of transaction, increased transaction limit, opportunities to receive social safety net programme allowances, etc. The use of MFS services is gradually increasing to ensure financial inclusion, including social safety net programme, education stipend programme, and salary payment in various offices. According to a report of Bangladesh Bureau of Statistics (BBS), in 2023, 51.7% of individuals aged 15 and above held an account with a bank or financial institution, or MFS. Exclusively 28.3% had accounts with banks, while 47.8% had MFS accounts. The amount of remittance received through MFS is gradually increasing, in 2024, Bangladesh received a total of BDT 107.86 billion of foreign remittance through MFS via legal channel.
Research Objective
The overall objective of this study is to identify the governance challenges in the Mobile Financial
Services (MFS) Sector in Bangladesh. The specific objectives are:
1. To review the legal and regulatory framework governing the MFS sector and assess its
compliance in practice.
2. To examine transparency, accountability mechanisms, institutional capacity, and overall
effectiveness using specific governance indicators.
3. To identify the nature, scope, and extent of irregularities and corruption in the sector.
4. To develop evidence-based recommendations based on research findings.
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