A summary overview of the fintech landscape in Bangladesh. We first take a look at the global history of fintechs, then the history of fintechs in Bangladesh. Using the Financial Hub Readiness (FHR) Index that I personally developed, I identified and assessed the strengths and weaknesses of various global fintech hubs. Based on this assessment, I proposed a hypothetical P2P lending and funding transfer product, that can be financed and implemented by major technological players in the ecosystem. This project was done to fulfill my requirement for the Internship course, for my BBA undergraduate program at Institute of Business Administration, University of Dhaka. This was the first time I had to work alone on an academic project of this magnitude. I am very satisfied with how it turned out, given the limited time and resources I had to execute it. Special thanks to all of my colleagues, peers and friends who advised me, in both professional and emotional capacities, when I was working on this project.

2. SYEDA MAHRUFA BASHAR
CHAIRPERSON
IBA CAREER CENTRE
TANISHA BUKHT
LECTURER
INSTITUTE OF BUSINESS
ADMINISTRATION, DHAKA
MUHTASIM SAROWAT RAYED
ZR-61, BBA 21st BATCH
MAJOR: FINANCE

3. 1
2
3
4
5
6

5. To conduct a comprehensive
industry analysis on Fintechs,
comparing four major sub-
industries, and to assess the
strategic implications of these
analyses for potential new
entrants.

6. To get an overview
of the fintech
industry both on a
global and
national scale.
To develop
consumer profiles
of the various
buyers of fintech.
To find out the
growth rate,
ecosystem stage
and key success
factors of each of
the sub-sector.
To conduct a cross-segment
comparison of the major four
segments in the industry to
understand the value chain
dynamics of each sub-
industry.
To identify problems,
opportunities, and the
scope of competitive
advantage from all
these analyses.

7. Structured questionnaire
Convenience sampling
Sampling frame: Age 20+, living in Dhaka
No. of respondents: 97
Digital Consumer Class and Industry
Professionals
News, industry reports and
white papers published by
PwC, Citi, KPMG and others
Company specfiic resources
(including work done for
clients)

8. Limited relevance of
secondary sources
due to lack of local
information
Confidential nature
of company and
client-specific
information

10. LightCastle Partners (LCP) is
one of the fastest growing
consulting firms in Bangladesh.
We combine data, analytics
and technology to solve real
world problems.
Working at the nexus of private,
public and development sector, we
specialize in
developing/implementing innovative
social enterprise models to forming
market entry strategies to building
world-class technology platforms.

11. 4+
years of presence
20+
members and growing
75+
local and international clients
120+
projects completed
250,000+
data respondents

12. Market
Intelligence
Consulting
and
Technical Support
Business
Analytics
Solution
Implementation

15. Simply defined, Fintech Refers to any collaboration between
finance and tech, where finance is the intended consumer and
technology is the prospective seller.

16. Credit Cards
1950s to 1980s
ATMS

17. Paypal and Alibaba
1990s to 2010s
M-Pesa and bKash

18. Fund Transfer
and Payment
Products
Asset and Wealth
Management
Products
Insurance and
Reinsurance
Products Banking and
Capital Market
Products

20. 195.08
BILLION USD
GDP
(2015)
6.9%
GDP GROWTH RATE
ADB FORECAST,
FY 17
32.09
BILLION IUSD
FOREX RESERVE
(DECEMBER 2016)

21. 84 80 77 73 70 66 62 59 55 52 48
44 48 52 56 60 64 70 75 81 86 92
17 18 19 20 21 22 23 24 25 26 2712 13 15 16 18 19 22 25 28 31 34
(30)
20
70
120
170
220
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
MILLIONS
BOP Aspirant Emerging Middle Middle and Affluent
With an annual growth rate of 10.5%,
the MAC population, as defined by
BCG, has middle class purchasing
traits, and have the purchasing
power to buy a broad variety of
goods

22. Financial Industry
Startups
Consumers
Vendors
Investors
Regulators and
Accelerators

23. bKash Rocket UCash mCash
Payza Payoneer Gpay RobiCash

24. Innovative Mindset
Regulatory Support
Technical AbilityBusiness Confidence
Investor Suppport
Bangladesh' Fintech Hub Readiness
Bangladesh’s Fintech Hub Readiness
Rating (1-5)
Innovative Mindset 4
Regulatory Support 3
Technical Ability 2.5
Business Confidence 3
Investor Support 3.5
FHR Index 3.2

25. In Bangladesh, where
smartphones are rapidly
becoming the norm (according to
Lightcastle’s forecasts, smartphone
penetration will increase to 75.8%
by 2021), the disruption will more
likely than not be brought on by
new entrants, like bKash did in
2011

27. Early Starters and Digital Aspirants represent most of the Digital Consumers while Connected Maestro represents the highest
value generated per customer.
EARLY STARTERS
Usually sole decision makers of the
family who receive information and
make purchase decision via online
platforms.
DIGITAL ASPIRANTS
Concentrated in Dhaka, digital aspirants are one
step closer to being truly digital. They purchase
low-cost items online and prefer cash on delivery
as primary payment option
TRADITIONALISTS
Traditionalists are dependent on
physical options for product
evaluation and purchase/payment
CONNECTED MAESTROS
Having 100% access to laptop and
smartphones, this group also involves chief
wage earners of the family preferring online/
mobile payment for online purchases.

28. 22.70%
41.20%
19.60%
7.20%
9.30%
2 3 4 5 5+
How many personal computing
devices do you own?
94%
6%
What kind of Phone Do You Use?
Smart Phones Both
10.30%
18.60%
35.10%
16.50%
19.60%
3 Hours 5 Hours 10 Hours 15 Hours 15+
Hours
On average, how many hours in
a day do you spend in front of a
screen?
The consumer side of the Internet of Things (IoT) phenomenon is
already in full swing in Dhaka.

29. Most respondents have moderate
levels of financial literacy and are
decent managers of their own
finances.
However, they have low
investment appetites and do not
tend to save for future
consumption, even when it comes
to equity investment.
43.30
%
6.20%
50.50
%
How do you manage
your personal assets
and wealth?
Keep personal ledgers and accounts
Use personal accountant
I don't worry about my assets and
wealth
3.10
% 15.5
0%
81.4
0%
What kind of
insurance do you
have?
Health Insurance
Health Insurance and
Life Insurance
None
17.5
0%
3.10
%
6.20
%73.2
0%
Do you invest in
these markets?
DSE Only
DSE and CSE
Global Commodities Markets
I do not invest in any markets

30. bKash has the most usage by far, with DBBL Rocket a
distant second.
3.04 1.1 1.0 1.0 1.73.04
On a scale of 1 to 5, could you tell us which of these
payment solutions you used the most?

31. 4.09
4.07
4.02
3.93
3.9
3.77
3.68
3.4 3.5 3.6 3.7 3.8 3.9 4 4.1 4.2
Commercial Banks
Vendors
The Government
Startups
Bangladesh Bank
NBFIs
Private Investors
In the coming years, on a scale of 1-5, how
important do you think these stakeholders are for
providing tech-driven, financial solutions?
3.10%
35.10%
43.30%
18.60%
Not Useful Slightly Useful Useful Very Useful
How Useful Do You Think Startups are
in Bangladesh?
While startups are generally seen as being useful, commercial banks and vendors were seen as
being the most important stakeholders in realizing the potential of fintechs in Bangladesh.

33. A MNO led fintech product that will offer services such as fund transfers, bill and utility
payments, and most importantly, P2P lending.
The P2P loans provided will be like microcredit in nature. The minimum volume will be 1000 BDT while the
maximum volume is 50,000 BDT. The minimum duration of the loans will be one day (eg. Overnight loans)
while the maximum duration is one month.
A M-WALLET BASED, P2P LENDING AND FUND TRANSFERS PRODUCT

34. SIMPLIFYING THE
CUSTOMER JOURNEY
Using a mobile app simplifies
the user experience, as
opposed to the typical USSD-
based payment funnel of
current m-wallet solutions
PROVIDING ROBUST SECURITY
OF SENSITIVE INFORMATION
AND TRANSACTIONS
Through using proprietary
blockchain and biometrics. In the
future, database of smart NIDs
can also be leveraged.
ENSURING TIMELY LOAN
PAYMENTS
A real time credit rating
system will penalize those
who often make delays in
loan payments

35. WHY DEALSTER IS POISED TO TAP THE NEXT DIGITAL EVOLUTION
Dealster’s functionalities and positioning approaches fintech from a lifestyle enhancer perspective for urban
youths and professionals. On the other hand, most existing fintech solutions in Bangladesh focus on
financial inclusion, which fits peri-urban, rural customers with limited access to and affinity for smartphones.

36. Tasks Year 0 Year 1 Year 2 Year 3 Year 4
Office Set-Up and
Team Building
Platform
Development
Securing Important
Partners
App Beta Launch
Pre-Launch
Promotional Drive
Launch: Userbase
Building Drive 1
Post Launch
Promotional Drive 1
Platform
Maintenance
Userbase Building
Drive 2

37. Year 0 Year 1 Year 2 Year 3 Year 4 Year 5
Sales Revenue 5,000,000 7,250,000 9,875,000 12,937,500 20,156,250
Transaction Revenue 2,500,000 3,750,000 5,625,000 8,437,500 12,656,250
Borrower Collection Revenue 2,500,000 3,500,000 4,250,000 4,500,000 7,500,000
Operating Expenditures 4,296,000 4,725,600 5,198,160 5,717,976 6,289,774
Taxes (@25%) 1,250,000 1,812,500 2,468,750 3,234,375 5,039,063
Operating Cash Flow (546,000) 711,900 2,208,090 3,985,149 8,827,414
Cash Flow from Investment -2,370,000
Net Working Capital (NPL
Provision) -6,300,000 6,300,000
Net Cash Flow -8,670,000 (546,000) 711,900 2,208,090 3,985,149 15,127,414
NPV 2,299,905.41 BDT
IRR 22%

38. IRR
22%
NPV (5 YEARS)
2.3 Million
BDT
BREAKEVEN POINT
2 Years

39. Regulatory
Roadblock
Technical
Difficulties
Competitor
Products
Failure to Reach
Critical Mass of Users