Deposits with the school banking accounts at commercial banks have crossed Tk 1,000 crore at end of 2016, according to Bangladesh Bank (BB) data.

The central bank’s latest quarterly report on financial inclusion shows that a total of Tk 1,020.79 crore was deposited with 12,57,370 school banking accounts at 56 scheduled banks up to December 31 last year.

The report also suggests that the school banking service is more popular in cities than in rural areas as 7,83,574 school banking accounts were opened in cities against 4,73,796 accounts in rural areas.

“Bangladesh Bank launched the special scheme for school students to inspire them on savings so that they can also contribute to the national economy. The deposit figure is impressive.

Besides, different initiatives are being taken to bring more school students under banking services,” a BB official told daily sun.

Bangladesh Bank on November 2, 2010 asked banks to launch the deposit product for students to encourage them to open bank accounts by keeping a minimum balance ranging from Tk 100 to Tk 500.

According to the central bank’s report, the deposit in the bank accounts of school students was Tk 714.49 crore on December 31 in 2014 and Tk 844.19 crore on December 31 in 2015.

BB data shows that deposit with the school children’s accounts at the state-owned banks increased to Tk 129.24 crore on December 31 from Tk 116.19 crore on September 30, 2016.

The figure rose to Tk 861.63 crore from Tk 839.39 crore in the private commercial banks, to Tk 9.51 crore from Tk 8.03 crore in the foreign commercial banks, and to Tk 20.41 crore from Tk 18.98 crore in the specialised banks.

Dutch-Bangla Bank, Islami Bank Bangladesh, Eastern Bank, United Commercial Bank and Rupali Bank are the five institutions that pulled most of the deposits from the students. Banks usually give one percent more interest on the deposits in the student accounts than the rate they offer for other savings products.

Islami Bank Bangladesh Limited opened 213,623 accounts, which is 16 percent of the total accounts, which Dutch Bangla Bank ranked the top by collecting deposits of Tk 342.99 crore with school banking accounts

“We have gone by the central bank’s directive about student savings account, which helped us in business expansion. Besides, the future generations of the country is getting the opportunity to be part of the general banking culture. Banks are giving priority to such special scheme as they are the future depositors of the banks,” Syed Walidur Rahman, an official at IBBL head office, told daily sun on Friday.

Rahman also said banks are organising different programmes to enhance banking literacy among students and guardians.