Dhaka, Bangladesh (BBN)– The government of Bangladesh on Sunday signed a $300 million financing agreement with the World Bank (WB) to improve cash transfer for poor.

The agreement was signed at the Economic Relations Division by Mahmuda Begum and Qimiao Fan on behalf of the Government of Bangladesh and the World Bank, respectively, according to a press statement.

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 programmes 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 about six and 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,” Qimiao Fan, World Bank Country Director for Bangladesh, Bhutan and Nepal, said in a statement.

In fiscal year 2018, Bangladesh spent about $5.8 billion on social protection or about 2.0 per cent 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 per cent.