Only 9 per cent garment factories pay wages to workers through mobile financial services (MFS) and 4 per cent through banks, according to a new study, whose findings may make it difficult for the country to digitally pay 4.1 million apparel workers overnight.
As many as 76 per cent garment factories pay wages to workers through cash, while 11 per cent disburse salaries through multiple models, the survey of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) showed.
The BGMEA conducted the survey to know the payment modes used by factory owners as the factory management has been preparing MFS accounts for workers to submit to banks.
The finance ministry and the Bangladesh Bank have made it mandatory for the factory owners to present the list of workers and their MFS and bank account numbers to banks if they want to use the government's Tk 5,000 crore stimulus package to pay workers.
The banks have been asked to directly pay to the workers' accounts.
The BGMEA survey was conducted among 160 factories, which employ 225,710 workers. Of the workers, 101,379, or 45 per cent of the workers surveyed, have MFS accounts. They use bKash, Rocket and similar kinds of MFS accounts.
"Using MFS, 1 per cent of the surveyed factories pay salaries to employees and 9 percent factories pay wages to workers. This is insignificant," the study said.
In Bangladesh, garment workers are grouped in seven grades. Wages are given to the graded workers and the salary to the non-graded employees, such as freshers and trainees.
Some 147,111 workers, or 65 per cent of the total, have national identification (NID) cards.
Some factories have reported that the workers who were not able to provide NID had submitted birth certificates. This is a clear indication that NID information must be obtained for all workers of a factory to ensure proper background verification, said the study.
Since not all workers and employees possess a smartphone, it might get in the way of going for 100 per cent MFS coverage outright.
The limitation of the study is it asked about the smartphone, but a good number of workers may have feature phones that may be used to operate MFS accounts.
The study recommended immediate action to enforce the opening of the MFS account of workers for wage payment.
There are a good number of workers who are not registered with the workers' database of the BGMEA.
It called for making workers' database registration mandatory and uploading the data within the next 30 days, or by May 10. The BGMEA's e-wallet should be rolled out immediately.
The survey asked the BGMEA to ask its members to collect the NID of workers and verify them well. The wages and salary payment should be well-preserved and it will be a part of critical resources for the industry, the study said.
Providing support to enhance the availability of smartphones or any kind of mobile devices for the workers can be ensured with the support of development partners.
This step can trigger the use of MFS accounts by workers, who now shy away from it for lack of mobile devices.
"MFS is not a choice for us any longer," said Rubana Huq, president of the BGMEA.
Rather it is mandatory to ensure transparency of the sector.
"Moreover, through a bank account or MFS, we could also save the hassle of workers coming to factories for salary. The sector does not have anything to hide or shy away from," Huq told The Daily Star in a WhatsApp message.
It's possible to open MFS accounts by this month, she said, adding that salaries for April need to be paid by the first week of next month.
"So, if we have the accounts by the first working days of May, it's all good."
All will be paid the salary for March. There's no reason to be worried about it, she said.
BGMEA members pay wages worth Tk 4,000 crore a month.