Microcredit Regulatory Authority
A Policy Fallacy Rooted in Over-Licensing and Weak Oversight
Bangladesh, with a GDP of around USD 460 billion in 2025, has one of the most over-licensed financial sectors in South Asia. It currently hosts 61 scheduled banks, 38 non-bank financial institutions (NBFIs), over 750 licensed microfinance institutions (MFIs), alongside 13 mobile financial service (MFS) providers, 9 payment service providers (PSPs), and 12 payment system operators (PSOs). These institutions are regulated by four bodies: Bangladesh Bank (BB), the Insurance Development and Regulatory Authority (IDRA), the Microcredit Regulatory Authority (MRA), and the Bangladesh Securities and Exchange Commission (BSEC). Yet financial inclusion remains suboptimal. A substantial segment of the population, including many in urban areas, remains excluded from formal financial services.
Microcredit vs. Appropriate Credit
Microcredit initiatives often come into question when discussing poverty alleviation efforts. What are microcredits, how they are provided, and what their implications are will be discussed later. It is worth mentioning here that significant changes have occurred in the microcredit scheme since 2011.