ADB Approved $2m for Remittance Project

Posted by BankInfo on Thu, Jan 20 2011 06:09 am

The Asian Development Bank (ADB) board approved a $2 million grant to launch a remittance investment project to provide safe, affordable remittance services to thousands of Bangladeshi migrant workers and their families. The Japan Fund for Poverty Reduction will be used in the project to fund technology linking micro finance institutions and banks. It will give at least 20,000 rural migrant worker households access to formal remittance services for the first time, ADB said in a statement yesterday.

Mayumi Ozaki, finance specialist (rural and microfinance) for ADB's South Asia Department said, "Currently, many rural migrants and their families are forced to rely on informal remittance outlets which are undocumented and risky,". "This project, using debit cards, points of sale terminals and other innovations will allow people in remote areas to send and receive funds through the formal banking system." The project will fund remittance and financial literacy training and an awareness campaign to provide guidance to returning migrant workers on investment products and employment opportunities.

The objective is to help each household save, or invest, an additional $300 a year, ADB said. The Bangladesh government will contribute $29,000, with banks and microfinance institutions providing nearly $386,000, for a total cost of over $2.4 million. The finance ministry is the executing agency for the project, which will run for three years to 2013.

News Source: The Daily Star/Bangladesh/20 Jan 2011