School banking getting traction
University banking is increasingly buying popular among students as the deposits within their accounts crossed Tk 1,600 crore in 2019.
As of December last year, pupils deposited Tk 1,626 crore found in the accounts, up 8 % from this past year, according to info from the central lender.
The quantity of accounts under school banking rose 10 per cent to 19.92 lakh last year.
A number of banks earlier took a set of procedures to widen the banking operation among students according to instruction of the central lender, presenting a boost to economic inclusion, bankers say.
The quantity of accounts and the outstanding balance under school banking would rise many folds if lenders initiate measures commensurate with enough time, a central banker said.
The central bank introduced the school banking this year 2010 as part of its efforts to widen financial inclusion and make students financially literate. The scheme aims to instill the behavior of savings into college students and make them better in money management.
So far, 55 banks have rolled out school banking operations, allowing college students aged 11 to 17 to open accounts.
The accounts come with a number of advantages, such as waiver on service fees and charges, free internet banking, lower minimum amount balance requirement and debit cards availability at lower costs.
Accounts could be opened with the very least deposit of Tk 100.
Dhaka Bank, among the top five banking institutions when it comes to mobilising deposits under school banking, arranges programmes at schools frequently so that you can raise awareness on building savings behavior, said its Managing Director Emranul Huq.
The lender rolled out two savings products - Students' Ledger and Edu Savings Plan - to attract students. Guardians in the beginning operate the accounts and the learners are allowed to run them after they turn 18.
Edu Savings Program is a good long-term deposit scheme where pupils park a specific amount on a monthly basis and the deposit is covered by MetLife Bangladesh.
Students with such accounts will receive insurance plan for health solutions along with rewards that include an insurance product.
Dhaka Lender mobilised deposits to the quantity of Tk 89 crore from students in 2019.
Islamic Lender Bangladesh Ltd also achieved success in popularising school banking products.
The lender ranked third when it comes to opening accounts and pooling deposits, said IBBL Deputy Managing Director Abu Reza Mohd Yeahia.
"Islami Bank arranges workshops because of its staff how to inspire students for savings. It has helped us accomplish success in institution banking," he said.
The bank runs awareness campaigns among the proprietors of its agent banking outlets in order that they can open makes up about students in an efficient manner.
The quantity of accounts and deposits at IBBL stood at 1.93 lakh and Tk 92 crore respectively towards the end of last year.
State-run Agrani Bank, which came second among all banks regarding beginning accounts, plans to mobilise deposits from learners, said its Managing Director Mohammad Shams-Ul Islam.
The lender has opened 2.30 lakh student accounts but is yet to mobilise deposits needlessly to say due to a lack of digitalisation, he said.
"We aren't sitting idle. We've taken several actions to digitalise the banking operation," he said.
He continued to trust that deposit collection would accelerate once the lender completes digitalisation.
The central bank organises gross annual school banking conference in every district to pull students to school banking as it finally helps build savings behavior, said Md Anwarul Islam, general manager of the financial inclusion department at the central bank.
The central bank has submitted a proposal to the National Curriculum and Textbook Board to add a chapter in textbooks to ensure that primary and secondary-level students can gather knowledge on financial literacy, he said.
