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Stunning innovations in our banking sector

Published : Sunday, 2 June, 2024 at 12:00 AM  Count : 455
Shabnam Nida Wazed
In the fast transformation of financial services into digital ones, it is evident over the last decade with enormous improvements and innovation in Bangladeshs banking sector in particular financial inclusions and in digital real time transactions by adopting the evolved technologies. From ID verification, instant account opening, branch less banking, underwriting and process automation there has been changes. A small fragment among that is digital lending using artificial intelligence (AI). Using applications that facilitate salaried people, particularly in manufacturing industries when they need money

The AI-driven Earned Wage Access (EWA) and nano-loans are providing financial relief to garment workers who are facing an unexpected medical bill or needing money for a childs school supplies. The EWA allows them to access a portion of their already earned wages, providing immediate relief and preventing them from resorting to high-interest loans from loan sources.

This is reducing financial stress and empowering them to be self sufficient and helps to manage unexpected expenses without falling into debt traps. Their lives become stable and boosts for a productive workforce. The AI can analyze vast amounts of data to assess creditworthiness beyond traditional methods, allowing MFIs to offer more targeted and responsible loan products to their clients. This can lead to improved repayment rates and a more sustainable MFI ecosystem.

It can automate tasks like loan application processing and credit scoring, potentially reducing operational costs for MFIs and allowing them to serve more clients efficiently. In regard to corporate employees the AI can bring a good solution to corporate employees who may face unexpected financial needs between paychecks. EWA provides a convenient and secure way to access a portion of their earned wages, helping them manage cash flow and avoid relying on credit cards with high-interest rates.


EWA and nano loan facilities can shed employees stress and it can demonstrate employer care and can contribute to a more positive and productive work environment. Companies can potentially reduce the need for employees to take out traditional loans, potentially improving overall financial well-being. Here is an analogy that Bangladeshs leading private commercial Prime Banks collaboration with AGAM International on a pilot program for EWA and nano loans demonstrates the potential of AI in this space. Agams AI-driven EWA and nano loans have become a powerful tool for financial inclusion and empowerment in Bangladesh.

Heres why high-quality AI is crucial and how new startups can contribute to this rising trend. The algorithms used for credit scoring must be unbiased and fair. High-quality AI ensures that loan decisions are based on relevant data, not discriminatory factors. Transparency in how AI arrives at decisions builds trust with users.

As financial transaction tools are sensitive the government should enact laws that will ensure the applications quality in protecting sensitive financial data like employee wages is paramount. Robust AI systems with advanced security measures are essential to prevent breaches and misuse of information.

For real time settlements accuracy and efficiency are two major factors. Accurate AI models are needed to assess creditworthiness effectively. This allows for responsible lending practices and minimizes the risk of defaults. Additionally, efficient AI streamlines processes like loan application processing, reducing costs and improving turnaround times.

The rise of EWA and nano loans presents a tremendous opportunity for new startups in Bangladesh. Through developing specialized AI models the startups can focus on creating AI models specifically tailored to the Bangladeshi context, considering factors like local economic conditions and informal work sectors.

By enhancing financial literacy the startups can develop educational programs and tools to educate users on EWA, nano loans, and responsible borrowing practices. This empowers individuals to make informed financial decisions and by promoting financial inclusion the new startups can target underserved populations, reaching those outside the traditional banking system and expanding financial inclusion across Bangladesh. Collaboration between startups, established financial institutions, and government agencies is a key. This fosters innovation, ensures regulatory compliance, and accelerates the growth of the EWA and nano loan ecosystem.
By focusing on high-quality AI and fostering a vibrant startup ecosystem, Bangladesh can unlock the full potential of EWA and nano loans. This will empower individuals, propel financial inclusion, and pave the way for a more prosperous future.

The AI-driven EWA and nano loans offer a win-win situation for all stakeholders. In this evolving digital transformation the use of such AI driven applications enhances garment workers in gaining financial security, MFIs expand their reach and improve efficiency and corporate employees benefit from increased flexibility and reduced stress. By implementing these services responsibly with a strong firewall and with a focus on financial literacy, Bangladesh can leverage AI for financial inclusion and empower its workforce towards a brighter economic future.

For a smart Bangladesh it is imperative to focus on the is evolving technology and introduce a new era of cashless society by accelerating digital automation. There is a vast potential for an AI driven financial market aiming to make life easy and step forward in parallel with Bangladeshs graduation to a developing country.

The writer is Chief Executive Officer of AGAM international Limited



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