Nagad to disburse 75pc of social safety net allowances

The government will distribute 75 percent of the social safety net allowances through Nagad, the digital financial service provider of Bangladesh Post Office.

Prime Minister Sheikh Hasina inaugurated the disbursement of the allowances through Nagad at a programme at the Bangabandhu International Conference Centre via video call from the Ganabhaban on Thursday.

Social Welfare Minister Nuruzzaman Ahmed presided over the programme while State Minister for Social Welfare Md Ashraf Ali Khan Khasru was present as special guest.

Prime Minister's Principal Secretary Ahmad Kaikaus moderated the event and Social

Welfare Secretary Mohammad Jainul Bari delivered the welcome speech.

The government distributes tens of billions of takas among the poor and the destitute under the social safety programmes every year.

Under the government to person (G-to-P) method, the government has already disbursed the funds among 1.237 million beneficiaries in 77 Upazilas under 21 districts through agent banking.

Nagad, one of the fastest growing digital financial service providers of the country, and another mobile financial service provider will disburse allowances among 7.613 million beneficiaries out of a total of 8.85 million.

In order to pay out the allowances, the government carried out demos in eight unions under eight divisions towards the end of last year.

Based on the demos, the government has decided to give out 75 percent of the allowances through Nagad in 40 districts.

The beneficiaries will not have to spend any additional money to cash out the funds from the government. The government will pay Tk 7 in cash-out charge to Nagad for every Tk 1,000 withdrawal. Nagad will bear the rest.

Post and Telecommunications Minister Mustafa Jabbar described the disbursement of social safety net allowances through mobile financial service firms, especially Nagad, as a “prominent example of the digitalisation of the financial industry”.

“Nagad is proof of the deep trust and confidence that the government services have created. Nagad is technologically so efficient that it can deliver all of the government's financial services to the people. I want to thank Nagad for making the government self-sufficient in at least one area," he said. 

Nagad Managing Director Tanvir A Mishuk said, “For us, this is a historic moment. We have always designed all of our services keeping in mind the country and the people of the country. As a result, we have earned the love of the government and the people in a very short time. We believe that the day is not far off when Nagad will digitalise the whole government allowance distribution system, and the people will also get what they are entitled to receive without any hassles."

Minister Nuruzzaman described Nagad’s services as “state-of-the-art technology”. He hoped that the government’s allowances will reach the right people within the shortest possible time under this process.

Secretary Bari described the programme as a “new chapter” in the disbursement of social safety net allowances.

“We want to thank Nagad for opening a new horizon of financial digitalisation in front of us. We believe that because of this service of Nagad, crores of underprivileged people in the country will have a better life,” he said.

The government will distribute the allowances under four programmes in the current fiscal year. It has set aside Tk 58.85 billion in the budget for the four programmes.

Under the schemes, Tk 29.4 billion has been allocated for 4.9 million elderlies eligible for old-age allowances.

The allocation for 250,000 widows and destitute women stands at Tk 12.3 billion. As much as Tk 16.2 billion has been allocated for 1.8 million insolvent people with disabilities.

Besides them, the government will pay Tk 956.4 miliion in educational stipends to 100,000 physically challenged students.

Earlier, Hasina distributed allowances as Eid gift through MFS operators among 5 million poor families, who had been affected by the coronavirus pandemic. Nagad disbursed the gifts among 1.7 million families.