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Results Briefs November 17, 2020

Improving the transparency and efficiency of safety nets for the most vulnerable in Bangladesh


Disability Allowance beneficiary opening his new digital account.

The World Bank

The project helps improve the efficiency and transparency of the country’s major cash transfer programs which provide benefits to over 8.8 million poor elderly, widows, and disabled persons. It does so by modernizing processes for data management, targeting, application, payment, and grievance redress, among others, and by leveraging country systems and strengthening institutional capacity.


Safety net programs play a significant role in Bangladesh’s poverty reduction and resilience building efforts. However, despite the range of interventions, as of 2019, only around one-third of the poor are covered by safety nets, primarily due to challenges in identifying vulnerable households, attesting to the lack of pro-poor targeting of social programs. There are duplicative efforts across programs, and outdated administrative systems limit the ability to respond to the needs of the vulnerable in a timely manner and to be fully accessible and accountable to citizens.

The Rohingya displacement crisis and the COVID-19 pandemic have also underscored the urgency of programs to adapt to shocks and changing circumstances.


The Cash Transfer Modernization Project contributes to the systemic reform of safety net programs by streamlining program processes, updating administrative systems to improve accuracy and enhance beneficiary experience, and developing effective accountability measures to build trust in the system. The project includes a combination of incentive-based investment and capacity development, with the latter particularly focusing on integrating various information systems across government. The COVID-19 context also necessitated agility and the project remained sufficiently flexible by adding a Contingency Emergency Response Component (CERC) in June 2020.

The project helps to strengthen the capacity of the Ministry of Social Welfare (MoSW), which administers the country’s major cash transfers, including significant changes to program administration to overhaul business processes, encompassing outreach, intake and registration, vulnerability assessment, enrollment decisions, recertification, case management, benefit payment, grievance redress, among others.

The modernization process would entail the extensive use of information and communications technology tools and interoperability mechanisms. The project helps to establish a results-based monitoring and evaluation system to assess the impacts of these programs and effectively support policy decisions. Modernization efforts leverage national administrative systems for identity verification (national identification database), targeting (the upcoming social registry) and payment (the government-to-person (G2P) payment platform), as well as the existing infrastructure of local level public-private partnerships for access to government services, and a network of banking and mobile money agents.

6.86 billion Bangladeshi Taka

6.86 billion Bangladeshi Taka has been delivered digitally to cash transfer recipients, of which 58 percent of the funds went to women (as of June 2020).


·  6.86 billion Bangladeshi Taka has been delivered digitally to cash transfer recipients, of which 58 percent of the funds went to women (as of June 2020).

·  1.14 million digital bank accounts have been opened for cash transfer recipients, of which 64 percent belong to women (as of June 2020). Digital accounts are those which provide enhanced security using cards, phones or biometrics. These accounts are hosted by private banks with a wider presence.

·  5.53 million cash transfer recipient records have been digitized with verified national identification data, of which 58 percent of the data pertains to women (as of September 2020).

·  $165.84 million has been disbursed to more than 4.36 million beneficiaries under the project’s Contingent Emergency Response Component to co-finance ongoing cash transfers for poor elderly, widows and disabled persons (as of August 2020). These cash transfers were expedited due to the COVID-19 crisis to ensure vulnerable groups had cash on hand to weather the negative economic impacts. This fund mobilization was the first emergency financing to be fully disbursed in Bangladesh to respond to the COVID-19 crisis.

Bank Group Contribution

The Bank Group contribution is on International Development Association (IDA) terms, as follows:

·  $270 million results-based financing (under Component 1) to incentivize actions towards improving delivery system of cash transfer programs. IDA financing contributes up to 30 percent of transfers to old age allowance recipients. Part of these funds have been mobilized for emergency response but will be “replenished” by external co-financing.

·  $30 million in technical assistance (under Component 2) to support enhancements of technology assets, utilize integrated information systems for targeting and payment, improve citizen engagement, and strengthen human resource capacity, and thus meet results-based financing targets under Component 1.


·  Ministry of Social Welfare (MoSW):  Responsible for all service delivery modernization efforts through its implementing agency, the Department of Social Services (DSS).

·  Ministry of Finance: Benefits from results-based financing, hosts the G2P payment platform used by MoSW, and is in the process of initiating policy reforms to institutionalize uniform targeting and payment systems across government safety net programs.

·  Aspire-to-Innovate (A2I) Program:  Provides technical support to MoSW on service delivery modernization initiatives.

·  French Development Agency (AFD): As a forthcoming co-financier, will “replenish” the results-based financing intervention. The Bank has leveraged this co-financing of 150 million euros to ensure original project objectives remain unaffected by emergency response fund mobilization.

Moving Forward

The cash transfer programs supported by the project have been part of the government’s regular programming for several decades. Modernization efforts will mean that beneficiary data and program processes are maintained electronically and leverage other national systems (i.e. for targeting and payment) – initiatives that are endorsed by the National Social Security Strategy and will be scaled across ministries/programs. This is also being driven by suitable policy reforms being initiated by government which the Bank would support through development policy lending. The improvements in program delivery make space for improvements in program outcomes such as enhanced financial literacy and program graduation for which the government has indicated interest in collaborating.

Implementation Period:
December 2, 2018 to June 30, 2023



Rumila, 70, is a beneficiary of the Bangladesh government’s Old Age Allowance. She used to receive her benefits at a state-owned bank but DSS has helped her to open a digital account with an agent of a private bank, which uses biometrics for customer verification. She prefers this system since it is smooth and saves her time.