When banks talk about agent banking, the conversation often starts with scale. At Midland Bank PLC, it starts with access. For Md Rashed Akter, head of retail distribution and chief bancassurance officer at Midland Bank, agent banking is less about replacing branches and more about reaching places where branches simply cannot work.
The model, he says, allows banks to extend formal financial services nationwide at a fraction of the cost of traditional expansion, particularly in rural and underserved areas.
Agent banking has become one of the most practical tools for financial inclusion. That social objective, however, is closely tied to economics.
Akter says the expansion of agent banking is driven by both policy goals and commercial logic. Financial inclusion remains the core purpose, but lower operating and servicing costs have made the model sustainable and scalable for banks.
At Midland Bank, that balance is reflected in the numbers. The bank currently operates 142 agent banking outlets across the country, serving a growing customer base.
As of December 2025, deposits mobilised through agent banking stood at Tk108 crore, while the loan portfolio reached Tk4.88 crore. The number of agent banking accounts rose to 55,546.
Transaction volumes and deposit mobilisation have grown steadily, and agent banking has begun to contribute meaningfully to both lending and profitability.
Like much of the industry, Midland Bank has seen deposits grow faster than credit through agent channels. Akter does not see this as a structural imbalance. He says the gap reflects prudent risk management and regulatory discipline rather than a one-way flow of funds.
The bank is gradually expanding retail, SME and agricultural financing through agent outlets to ensure that locally mobilised funds are increasingly recycled within local economies.
A key step in that direction is the planned introduction of a digital nano loan. Still under process, the product is expected to enable small, data-driven lending through agent banking, accelerating credit outreach at the grassroots and narrowing the gap between deposits and loans.
Risks remain part of the model, and Akter identifies financial illiteracy as the most persistent challenge. Misunderstanding banking products can expose customers to fraud, misuse and consumer protection issues, which in turn create operational, reputational and compliance risks for banks.
To manage this, Midland Bank places strong emphasis on customer awareness as a core risk-mitigation strategy. Rigorous agent selection, training, transaction limits, real-time monitoring, internal audits and strong compliance frameworks are paired with structured financial literacy programmes.
The goal, Akter says, is not only to protect customers but to strengthen trust and ensure the long-term sustainability of agent banking.
Responsibility, he stresses, is clearly defined. If misconduct occurs at the agent level, the agent is held accountable and required to compensate customers for any financial loss.
Any failure within the banking framework itself remains the bank’s liability, and remedial action is taken accordingly.
Where fraud occurs outside approved banking channels, responsibility rests with the agent. Continuous customer education is meant to reduce such risks and reinforce discipline. Instances of agent-related customer losses, Akter says, have been limited. Where verified cases have occurred,
Midland Bank has compensated affected customers promptly in line with internal policy and regulatory expectations. No incidents have resulted from negligence on the bank’s part.
Looking ahead, he sees sustainability resting on two pillars. The first is deeper customer awareness and financial literacy, without which the benefits of agent banking cannot be fully realised. The second is a forward-looking, risk-based regulatory framework that supports technology-driven growth while maintaining strong consumer protection.
Over the next five to ten years, Akter expects agent banking to evolve beyond cash-based services into comprehensive financial platforms offering savings, credit, remittances, insurance and other digital services.
Operations are likely to expand across virtually all thana and union levels. Transaction volumes through agent banking could eventually surpass those of traditional branches, and with deeper digitalisation, may even rival mobile financial services in scale.
In that transition, traditional branches may play a more limited role. Agent banking, Akter believes, is on course to become the primary channel for widespread financial access in Bangladesh – anchored in inclusion, disciplined by risk management and driven by technology.
