A pioneering scheme enabling street children to deposit money into bank accounts is falling in popularity due to a lack of coordination among stakeholders and a funds shortfall among the charities enlisted to operate the accounts on behalf of the children.
Bangladesh Bank unveiled the scheme in March 2014 to allow street children and child workers to open bank accounts with only a minimum Tk10 initial deposit.
The central bank directed a number of non-government organizations (NGOs) to deposit the money on behalf of the account holders until they turn 18.
To help run the program, Save the Children formed an alliance of local NGOs called the Banking for Working Children Advocacy Group. Each child had to be registered under an NGO program to open an account.
These NGOs are now unwilling to continue their work due to funds crunch and are not launching new projects for the street children.
“A funds crunch has forced several NGOs to withdraw support,” Wahida Banu, executive director of Aparajeyo Bangladesh, said. “It is difficult for them to continue supporting the program after the end of projects.”
A Bangladesh Bank report noted that 4,671 accounts were opened through 15 NGOs in the July-September period of 2017, with Tk4,689,000 deposited.
These figures dropped in the final quarter of last year, however, with 4,544 accounts opened through 14 NGOs at 18 banks, with a total of Tk2,711,000 deposited - a fall of 42% on the previous quarter.
Rupali Bank was the most popular institution with Tk9.76 crore deposited across 974 accounts, ahead of Social Islami Bank with Tk2.34 crore in 815 accounts, according to the central bank’s latest data.
Mohammad Mamunur Rashid, manager of the Civil Society and Child Rights program at Save the Children Bangladesh, said a lack of coordination among stakeholders and financial challenges had hampered the success of the scheme.
“Even though the NGOs appeared willing to support the scheme, their lack of technical capacity and understanding, fund limitations and mainstreaming banking in their regular programs remained the main challenges,” he said.
Mamunur noted that the scheme had intended to educate children in basic numeracy, literacy, and financial processes while building their confidence as future entrepreneurs. “All of these are absent in the existing system,” he said.
Golam Mohiuddin, joint director of the Financial Inclusion Department of Bangladesh Bank, told Dhaka Tribune that four parties are involved in the scheme: the central bank as the regulatory body, commercial banks, NGOs, and the street children themselves.
“The commercial banks are not taking any initiative regarding the accounts of the street children and the central bank is not telling them anything either,” he said.
“The NGOs had initially thought that working with street children would help them to get funds from the banks, but things did not go their way and they are now losing their interest to work with the street children.”
He said Chittagong-based NGO Ghashful was planning to set up 1,500 bank accounts for the street children. “The deposits will increase in the next quarter, but it will drop again,” he said.
The 18 banks involved in the project are: Sonali Bank, Janata Bank, Rupali Bank, Agrani Bank, Bangladesh Krishi Bank, Bangladesh Development Bank, Bank Asia, Mercantile Bank, Mutual Trust Bank, National Bank, Social Islami Bank, One Bank, Pubali Bank, The City Bank, Trust Bank, Al-Arafah Islami Bank, Uttara Bank and Prime Bank.
The 14 NGOs in addition to Save the Children are: Uddipan, EBCR Project, MSSUS, SUF, Brac, Aparajeyo Bangladesh, AID Bangladesh, ASD, CPD, Shakti Bidyalaya, Prodipan, Sazida Foundation, Nari Maitree and Poriborton.