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Add to Preferred SourcesThe government of Bangladesh signed a $300 million financing agreement with the World Bank to improve the transparency and efficiency of its major cash transfer programs for the poorest and vulnerable, including the elderly, widows, and people with disabilities.
The Cash Transfer Modernization Project will help the Department of Social Services (DSS) modernize the country’s four major social protection programs using cash transfers by improving beneficiary targeting, program administration, and benefit payments. The programs are the Old Age Allowance, Allowances for the Widow, Deserted and Destitute Women, Allowances for the Financially Insolvent Disabled, and Stipends for Disabled Students. These programs collectively reach more than six and a half million of the country’s poorest people.
“An efficient, automated and transparent social protection service delivery system is critical to build resilience and create opportunities for the poorest people,” said Qimiao Fan, World Bank Country Director for Bangladesh, Bhutan and Nepal. “The World Bank is helping the government build common digital platforms to better administer safety net programs. This will help reduce administrative costs and errors by identifying the most vulnerable people with greater accuracy and transferring cash in a timely manner.”
In fiscal year 2018, Bangladesh spent about $5.8 billion on social protection, or about 2 percent of its Gross Domestic Product, and improving the efficiency of these programs will help Bangladesh to use public resources more effectively.
“The government is committed to develop a digitized modern social protection service delivery system,” said Mahmuda Begum, Additional Secretary, Economic Relations Division. “This project is a critical step forward towards this vision and aligned with the National Social Security Strategy, 2015.”
The credit is provided by the International Development Association, the World Bank’s concessional lending arm, which provides grants or zero-interest loans. The credit has a 38-year term, including a six-year grace period, and a service charge of 0.75 percent.
The World Bank was among the first development partners to support Bangladesh following its independence. The World Bank has since committed more than $29 billion in grants and interest-free credits to the country. Bangladesh currently has the largest IDA program totaling $11.3 billion.
Original source: World Bank
Published on 28 October 2018