A new Financial Innovation Lab in Bangladesh (FinLab BD) launched by Aspire to Innovate (a2i), UN Capital Development Fund (UNCDF) and MicroSave Consulting (MSC) will serve low and moderate-income populations by advancing sustainable pro-poor growth. The FinLab BD is a platform that will support startups, public and private stakeholders, and funding organizations in building enduring business models that contribute to the Sustainable Development Goals (SDGs) in Bangladesh.

While the digital finance sector in Bangladesh has experienced rapid growth in the last decade, 50 percent of the country remains excluded from formal financial services. It is low and middle-income segments of the population that are missing out on the digital revolution, but also stand to benefit the most if digital services are made accessible and affordable to them. To this end, a2i, MSC and UNCDF have jointly established the FinLab BD to act as a platform that engages the private and public sectors to reduce poverty and expand economic participation, particularly for women and youth.

Future collaborations of the FinLab BD will include partnerships to provide investment support for innovations, capacity development for startups to navigate government regulations and policies, and regulatory sandboxes for policy-making institutions and startups.

Honourable State Minister for the Information and Communication Technology Division of the Ministry of Posts, Telecommunications and Information Technology in Bangladesh, Mr. Zunaid Ahmed Palak, MP, inaugurated the FinLab BD on 24 October 2021 as the chief guest. Deputy Governor of the Bangladesh Bank Mr. Ahmed Jamal, Policy Adviser of a2i Mr. Anir Chowdhury, and Regional Coordinator for UNCDF in Asia Ms. Maria Perdomo attended the event as special guests while the Project Director of a2i and Joint Secretary of the Information and Communication Technology Division Dr. Dewan Muhammad Humayun Kabir chaired the launch.

Speaking at the event, Honourable State Minister Mr. Zunaid Ahmed Palak said, “The youth, the entrepreneurs and startups in Bangladesh have the potential to resolve problems and create a positive social impact. All they need is guidance, funding and mentoring in the correct direction. For this purpose, the FinLab BD will enhance financial inclusion through technology and a digital-first approach to help us reach our goals even faster. The collaboration will be crucial for the success of the lab. As startups, industry experts, financial service providers, regulators, investors, and donors come together, we can collectively contribute to the financially included digital Bangladesh.”

Deputy Governor of Bangladesh Bank Mr. Ahmed Jamal added, “The FinLab BD will foster the innovation and capacity of fintechs in the Bangladesh market. Technology has touched all aspects of our everyday life with the Fourth Industrial Revolution (4IR). Bangladesh Bank has built a safe, secure and efficient payment ecosystem for the country to align its payment system with the goal of digital Bangladesh and to also monitor and supervise as the central point. Bangladesh Bank will provide its full support to the FinLab BD.”

Mr. Anir Chowdhury, Policy Advisor at a2i said, “a2i has been working diligently to build digital Bangladesh focusing on a customer-centric public service ecosystem to simplify the life of end-users – the residents of Bangladesh – by making services more inclusive, affordable and reliable. One of the core components is to catalyze digital financial services and fintech innovation. We are jointly working with Bangladesh Bank, different ministries and departments, development and technology partners, financial service providers, international organizations and donors to involve the marginalized people in the formal economy for the last three years. We have conceptualized with UNCDF and MSC to create an innovation lab that focuses exclusively on enhancing financial inclusion of low and moderate-income people.”

Ms. Maria Perdomo, Regional Manager for Asia, Inclusive Digital Economies at ‎UNCDF said, “UNCDF intends to accelerate the growth and competitiveness of fintech and other tech-based digital financial service initiatives in different sectors and segments to achieve an inclusive digital economy. We are very excited to have a2i and MSC working with us in realizing this. The role of innovation in financial service and technology is crucial to accelerate the growth of digital financial services, to bridge the gap and ensure that no one is left behind.”

Mr. Anil Kumar Gupta, Partner at MSC said, “Despite so much progress, a large segment of the population is unable to benefit from the digital revolution. Incumbents find it difficult to serve them due to high costs. The FinLab BD is our attempt to bring various partners and innovative solutions to serve the underserved segments at a scale. MSC profusely thanks MetLife Foundation for their support to launch this initiative.”

The panel discussion on how fintech startups and incumbents can play a role in improving the financial health of the low and moderate-income populations of Bangladesh was held after the inauguration of the FinLab BD. Mr. Krishna Thacker, Asia Director at MetLife Foundation, Ms. Soumya Basu, Country Manager for Bangladesh, Nepal and Bhutan at Visa, Mr. Ilmul H Sajib, Cofounder and COO at Sheba Platform Limited and Mr. Haque Khandaker, CEO at UpaySydul participated in the panel discussion. Mr. Manoj K Sharma, Managing Director at MSC moderated the panel discussion and Mr. Md. Tohurul Hasan, Programme Manager for Digital Access and Digital Financial Service at a2i conducted the panel discussion.

By bringing together the expertise from a2i, UNCDF, and MSC, the FinLab BD presents an important opportunity to support Bangladesh’s efforts to expand digital and financial inclusion. This will create more avenues to expand the reach of affordable digital services to the most vulnerable, allowing Bangladesh to make critical progress against the SDGs.

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About a2i

a2i (Aspire to Innovate) is a programme of the Information and Communication Technology Division of Bangladesh and the flagship programme of Digital Bangladesh put forth by the Government of Bangladesh with a central aim to incentivize and provide innovative solutions in the public sector. In conjunction with the Government of Bangladesh, the programme has leaned specifically towards unlocking the socioeconomic potential of the Bangladeshi citizenry through modern and innovative digital advancement. In line with SDGs, an important aspect of a2i’s work has been providing decent work and economic growth opportunities for the citizenry and the country.

About MSC

MSC (MicroSave Consulting) is an international financial inclusion consulting firm dedicated to strengthen the capacity of institutions to deliver market-led, scalable financial services to all people. Over the last 20 years, MicroSave has designed and implemented nearly 75 digital finance projects across Africa, Asia, and Latin America with over 200 banks, MFIs and MNOs to develop and test over 200 different financial inclusion products and channels.

About UNCDF

The UN Capital Development Fund makes public and private finance work for the poor in the world’s 46 least developed countries (LDCs). UNCDF offers “last mile” finance models that unlock public and private resources, especially at the domestic level, to reduce poverty and support local economic development. UNCDF pursues innovative financing solutions through: (1) financial inclusion, which expands the opportunities for individuals, households, and small and medium-sized enterprises to participate in the local economy, while also providing differentiated products for women and men so they can climb out of poverty and manage their financial lives; (2) local development finance, which shows how fiscal decentralization, innovative municipal finance, and structured project finance can drive public and private funding that underpins local economic expansion, women’s economic empowerment, climate adaptation, and sustainable development; and (3) a least developed countries investment platform that deploys a tailored set of financial instruments to a growing pipeline of impactful projects in the "missing middle."