MRA and IFC sign agreement to advance digital transformation

The Microcredit Regulatory Authority (MRA) and the International Finance Corporation (IFC) have signed an agreement for a project worth approximately USD 350,000 aimed at enhancing the capacity of microfinance institutions (MFIs) and regulators in Bangladesh.

The project will promote digital financial services (DFS) and expand access to short- and medium-term housing loans within the microfinance sector.

The signing ceremony took place today at the MRA headquarters, where Professor Dr Mohammad Helal Uddin, Executive Vice Chairman of MRA, and Mr Mehdi Charqui, Manager (FIG Upstream and Advisory) for South Asia at IFC, formally signed the project document titled "Bangladesh Microfinance Sector Development (BMSD)". The event was attended by Mr Md Saeed Kutub, Additional Secretary, as Guest of Honour. Senior officials from the Ministry of Finance, Bangladesh Bank, leading MFIs, journalists, and representatives from both MRA and IFC were also present.

The project aims to assist MFIs in transitioning their operations to digital platforms and create an enabling environment for providing quality housing solutions to low-income communities through short—and medium-term loans. It will also strengthen MRA's internal capacity and support the development of policies, roadmaps, and guidelines related to digital financial services and housing microfinance.

In 2023, MRA and IFC jointly conducted a study titled "Microfinance Sector Development Diagnostic: Digital Transformation and the Offering of Financial Services and Micro-Housing by MFIs", whose findings and recommendations served as a key foundation for this new initiative.

Mr Mehdi Charqui noted at the event, "This joint effort between IFC and MRA blends global expertise with local realities and will open new avenues for financial inclusion and improved living standards at the grassroots level, particularly for women."

Professor Dr Mohammad Helal Uddin, Executive Vice Chairman of MRA, remarked, "Today's signing marks a significant milestone in steering Bangladesh's microfinance sector towards a technology-driven, timely, and inclusive financial ecosystem. As the regulator, MRA is committed to facilitating enabling policies, supporting pilot initiatives, and strengthening its internal capacity to oversee this rapidly evolving sector proactively."

As part of the project's broader scope, a series of capacity-building initiatives will be organised for MRA officials, including workshops on digital maturity tools, exposure visits, and training sessions on digital transformation, digital financial literacy, and housing microfinance. These activities will contribute to designing and developing effective policies and monitoring frameworks for the sector.

The project duration has been 18 months, with an estimated budget of USD 350,000.