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still balance commercial and socio-economic objectives. A 2020 report by the Bangladesh Institute of Development Studies noted the positive impact of bKash in many areas of Bangladeshi life, including empowering women, increasing household incomes, improving financial transparency and inclusion, boosting entrepreneurship, and facilitating creditworthiness and loans. In fact, bKash is so embedded in the day-to-day lives of Bangladeshis that the Government designated bKash as an essential service when the COVID-19 pandemic struck. Despite its accomplishments, challenges remain for bKash. There is a risk, for example, that attention is focused on the revenue-generating potential of the new smartphone ecosystem, to the detriment of the USSD-based ecosystem and bKash’s financial inclusion objectives. After all, while 96 per cent of Bangladeshis have a mobile phone, in 2022 only 52 per cent possessed a smartphone. For now, though, bKash still seems firmly focused on its social mission. See, for example, the memorandum of understanding signed between bKash and Huawei in March 2023 at an event titled ‘Smart Fintech: Inclusive. Innovative. Inspiring Bangladesh’. As CEO Quadir stressed at the event, bKash’s and Huawei’s joint efforts in Bangladesh aim to drive financial inclusion, provide innovative solutions to tackle poverty and meet the UN’s Sustainable Development Goals.
Using self-esteem to market local goods by Özgün Atasoy
telcos to join its platform, gaining the mobile network infrastructure it needed and access to almost all of Bangladesh’s 100 million mobile phone subscribers. For their part, the telcos initially received seven per cent of the transaction fee revenues conducted across their networks. To broaden its agent network, bKash incentivised firms that supplied consumer goods to thousands of small stores throughout Bangladesh to recruit the owners of these small stores as agents by giving them 77 per cent of their transaction fee revenues as commission. 3 Understand the context, adapt and evolve At first, bKash tailored its service to the needs of rural farmers at the bottom of the pyramid. As nearly half of the population owned a basic mobile phone, it began by offering a limited choice of services – cash in, cash out and in-country transfer – using a simple code-based technology, unstructured supplementary service data (USSD), that worked on these phones. By 2017, bKash’s service had
been widely adopted with close to 30 million account holders. Now bKash wanted to reduce reliance on both the telcos and network of agents, cut fraud, and move beyond its usual customer base to target other segments of the population. To accomplish this, bKash changed the mix of partnership expertise. In 2018, bKash obtained investment from Ant Group, the owners of the one-stop-shop Chinese super-app Alipay, along with its help developing a similar type of super-app to provide bKash users with smartphone access to a wide range of app-integrated services. It also licensed Chinese tech firm Huawei to provide the digital network infrastructure and cloud payment technology to enable the new super-app services (Huawei also took on the existing USSD service ecosystem). This encouraged SoftBank to acquire a 20 per cent stake in bKash, securing bKash’s future as a major player in the mobile financial services market. A decade after its launch, the bKash story shows how it is possible to scale a tech venture in a developing economy and
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Sustainable Development Goals
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