According to Mosleh Uddin Ahmed, managing director of Shahjalal Islami Bank PLC, agent banking has become one of the most practical ways for banks to reach people who live far from traditional branches.
For a Shariah-compliant lender like Shahjalal Islami Bank, the model combines business efficiency with a clear social purpose, he said.
From the bank’s point of view, agent banking allows services to expand across wide rural and remote areas without the high cost of setting up branches. It helps mobilise deposits, reach new customers and keep operating expenses under control.
Ahmed said that at the same time, it plays a clear role in promoting financial inclusion and meeting banks’ responsibilities to society.
For customers, the benefits are more direct. Basic banking services that once required long travel are now available close to home. People can open accounts, deposit or withdraw cash, pay bills and use digital services in familiar surroundings.
This saves time and money and makes banking less intimidating, especially for first-time users and rural customers.
Ahmed said the growth of agent banking has been driven by two forces at the same time. One is the goal of financial inclusion, bringing unbanked and underbanked people into the formal system.
The other is economics. Compared with branches, agent outlets offer a much cheaper way for banks to expand their reach and serve more customers.
At Shahjalal Islami Bank, agent banking is growing steadily but carefully. The bank currently operates 148 agent outlets across the country. Deposits collected through these outlets have reached around Tk84 crore, and the number of agent banking customers has crossed 46,000.
Recently, the bank has introduced investment products for agent banking customers and plans to extend these services further into rural and deep rural areas.
Like most banks, Shahjalal Islami Bank collects far more deposits through agent outlets than it lends through the same channel.
Ahmed said this does not mean money is being unfairly taken away from rural areas. Deposits collected by agents are pooled at the bank level and then used according to overall credit demand, liquidity needs and risk assessment, rather than being limited to one location.
Still, he agrees that expanding credit responsibly in agent-served areas is important. As suitable investment products and risk controls are developed, he expects lending through agent banking to grow gradually and in a balanced way.
Stressing that risk management is critical, he said agent banking exposes banks to operational errors, fraud, cash shortages, compliance lapses and reputational damage, largely because agents operate outside the controlled environment of traditional branches.
To manage them, the bank follows a strict process. Agents are carefully selected and trained. Transactions are monitored in real time, limits are set, and regular audits are conducted.
Customer awareness programmes are also used to reduce misunderstandings. So far, the bank has not faced any cases of fraud or cash-related misconduct at its agent outlets, and no customers needed to be compensated for agent-related losses.
If any such incident were to happen in the future, the managing director said the bank would act under the terms of its contract with the agent following proper investigation.
On regulation, he pointed out that Bangladesh Bank’s guidelines clearly prohibit agents from working with more than one bank, and Shahjalal Islami Bank fully supports this rule.
He believes the regulatory framework has broadly kept pace with the growth of agent banking with clear guidance on agent selection, transaction limits and customer protection.
Ahmed said technology has played a major role in shaping agent banking. Real-time transaction processing, secure fund transfers and instant account updates have improved speed and reliability.
Digital systems also help monitor transactions and detect unusual activity. In the future, he expects technology, such as advanced analytics and biometric solutions, to further strengthen security and efficiency.
Looking ahead five to ten years, Ahmed sees agent banking expanding deeper into underserved areas and offering a wider range of services. These could include savings and investment products, insurance enrolment and government benefit payments.
With strong governance, proper training and effective use of technology, this prominent banker believes agent banking can grow into a trusted and sustainable channel that supports financial inclusion while keeping risks under control.
