Digital Improvements to Microfinance in Bangladesh

Abstract

This study aims to explore digital improvements to microfinance in Bangladesh. A qualitative approach was used as the research strategy. In-depth interviews were conducted with ten key informants, employing purposive sampling. Content analysis and NVivo were used to analyse the qualitative data.  The findings revealed that digital technology has the potential to significantly enhance Bangladesh’s microfinance sector. The benefits include increased transaction efficiency and speed, lower operational costs, improved access to financial services for rural and underbanked populations, better loan portfolio management and lower default rates, and increased transparency and accountability. Before digital technologies can be used in the microfinance sector, issues such as the lack of infrastructure, poor digital literacy, security concerns, and regulatory barriers must be addressed. With the proper approach, digital technology has the potential to transform access to financial services for millions of Bangladeshis. As a result, governments, administrations, and policymakers must implement effective digital technology-based microfinance strategies. A recommendation for future research is to expand this study to more areas and samples. Also, a quantitative study, such as one using online questionnaires, should be considered.