The Asian Development Bank (ADB) on Thursday approved a $250 million policy-based loan to support social protection reforms in Bangladesh designed to protect vulnerable population against socioeconomic challenges.
The loan will finance Subprogram 2 of the Strengthening Social Resilience Program and build on the first subprogram which implemented institutional and policy reforms that strengthened the inclusiveness and responsiveness of social protection in Bangladesh.
“This subprogram continues ADB’s support to improve the coverage and efficiency of social protection programs in Bangladesh, build resilience of the disadvantaged, and support an inclusive recovery.”
Under the new program, ADB is supporting the government in strengthening reforms to improve social protection coverage and efficiency, deepen the financial inclusion of disadvantaged people, and strengthen the response to diversified protection needs.
In various stages of implementation, some specific reforms include better protection coverage of disadvantaged women and the urban poor.
Subprogram 2 also helps to improve efficiency by digitalization and integration of systems as well as harmonization of government programs.
Greater financial inclusion of the disadvantaged will be broadened by improving the usability of mobile financial services through the quick response (QR) code payment services, particularly in rural areas.
This subprogram also supports a contributory protection scheme by focusing on an employment injury scheme.
Most social protection programs in Bangladesh are funded by the government and target the poor and vulnerable.
This contributory protection scheme will offer protection to a wider population and help augment government financing for social protection.
As of 2021, ADB’s cumulative assistance to Bangladesh since 1973 amounted to about $48 billion through loans, grants, and co-financing. ADB’s active portfolio in the country stands at around $11 billion with 50 projects as of April 2022.