How Rocket helped build Bangladesh's mobile-driven financial ecosystem

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• As mobile banking reshapes how Bangladesh transacts, regulators and MFS providers must act to curb fraud, strengthen security, and protect the country's financial ecosystem.

When we look at Bangladesh's digital banking journey today, it is impossible to ignore the transformative role played by mobile financial services (MFS) and app-based banking.

What began as a simple attempt to make money transfers easier has grown into a nationwide financial ecosystem—reshaping habits, opening economic opportunities, and bringing millions into the formal banking system for the first time. Being directly involved in this evolution, I've seen first-hand how the mobile app has become not just a tool, but a catalyst for inclusion, innovation, and behavioural change.

A new path to financial inclusion
Mobile banking didn't just modernise the banking system; it created a parallel, mobile-first financial ecosystem reaching people traditional banks never could. In rural areas where a physical branch was a distant dream, the agent-based model—supported through a simple app or USSD code—became the local "branch." Farmers, day labourers, and small shop owners could access services once reserved for urban account holders. Cash-In, Cash-Out, P2P transfers, utility bill payments, and merchant payments—tasks that once required time-consuming trips to a branch—became widely accessible. This shift wasn't only about convenience; it made banking relevant for daily life. Micro-transactions—from sending Tk200 to family members to paying a Tk50 bill—became the backbone of digital adoption.

Infographics: TBS

Fueling the digital economy
As digital payments became commonplace, they unlocked growth for entire industries. The rise of e-commerce and F-commerce in Bangladesh owes much to the reliable infrastructure early mobile apps created. Small online sellers, ride-sharing drivers, and home-based businesses all found in MFS a trusted, fast way to receive money. Entrepreneurship no longer required a shop, a card machine, or even a bank account—a smartphone and an app were enough.

MFS platforms and behavioural shift
Rocket, one of the early MFS pioneers, played a key role in shaping customer behaviour. Before MFS, people trusted physical cash more than anything. Simple, reliable services like Cash-In/Cash-Out, P2P transfers, and merchant payments gradually encouraged customers to treat their mobile phones as secure wallets. For garment workers, small business owners, and remittance recipients, this was life-changing: funds could be accessed instantly without losing a day's wage travelling to a bank. High uptime, reliable transactions, and transparent fees built trust, laying the foundation for the fintech revolution we see today and driving innovations such as government social safety net integration, educational payment solutions, and advanced financial products.

Towards a cashless Bangladesh—challenges included
Bangladesh's low bank penetration but high mobile usage makes mobile banking the most powerful driver of a cashless future. Apps now allow instant merchant onboarding via QR codes, enabling even street-side vendors to accept digital payments. Government-to-Person (G2P) payments have been transformative: subsidies and stipends directly into mobile wallets make government spending digital. Salary disbursements through MFS shift workers' spending to digital channels, while interoperability between banks, MFS, PSO, and PSP reduces reliance on cash-out counters. E-commerce growth and direct remittance to mobile wallets further minimise cash dependency.

However, mass adoption has exposed vulnerabilities. A huge number of MFS frauds involve online gambling, digital hundi, OTP sharing, social engineering, deceiving people, crypto purchases, payments for porn or child porn, renting MFS accounts, and unauthorised OTC transactions. Cases have emerged where an MFS account is created in the name of one person while the SIM and NID belong to others. Agents sometimes register one SIM as an "Agent SIM" but frequently change devices and locations, bypassing transaction limits using multiple SIMs. Digital hundi spreads money electronically through hundreds of Agent SIMs, undermining national reserves.

Regulatory measures for safer growth
To address these issues, authorities recommend strict verification: names, parents' names, DOB, and addresses must match across MFS, NID, and SIM records. Device-SIM-Geolocation binding should be mandatory, P2P on Agent's personal SIMs prohibited, and AI used to detect suspicious activity such as hundreds of transactions from one SIM or late-night transactions. Bangladesh Bank's interoperability among banks, MFS, PSO, and PSP can further reduce cash dependency, enabling secure digital transactions like bill payments, tuition fees, e-commerce purchases, and tax payments. Limiting or discontinuing agents who facilitate fraud is now crucial for building a Cashless Bangladesh, following examples like India's Paytm, which operates with minimal physical agents despite rural coverage.

Lowering costs for banks and customers
Mobile apps also reduce operational costs. For banks, fewer branch visits lower manpower and infrastructure expenses, while automated KYC, notifications, statements, and complaint management streamline operations. For customers, services like balance inquiries, bill payments, and P2P transfers are often free, and the risk of cash theft disappears. Digital transactions save time and minimise physical cash handling.

The next leap requires regulatory support
Bangladesh Bank has been proactive, but further policy enhancements could accelerate adoption. Remote e-KYC, eased merchant KYC for micro-sellers, standardised cybersecurity frameworks, and incentives for digital payments would enhance trust and usage. Using mobile transaction histories for alternative credit scoring could create new financial opportunities for millions, making digital finance both inclusive and secure.