Despite persistent inflation and rising education costs, students are steadily building their savings, with deposits under school banking schemes increasing every month since February.
Deposits in school banking accounts rose by Tk 4.06 million in May from the previous month to more than Tk 20.28 billion, according to the latest data from Bangladesh Bank.
The deposit balance stood at Tk 20.24 billion in April, Tk 20.03 billion in March and Tk 19.65 billion in February, showing a continuous upward trend over the four-month period.
The increase came even as households continued to face pressure from elevated living and education costs. Inflation, however, eased slightly in June, with point-to-point headline inflation falling to 9.16 per cent from 9.42 per cent in May, according to the latest Consumer Price Index data from the Bangladesh Bureau of Statistics.
The steady growth in student deposits has also been accompanied by a sharp rise in the number of school banking accounts.
The number of such accounts exceeded 5.33 million at the end of May, up from 5.18 million in April, an increase of 144,606 in a single month.
Male students held 2.71 million accounts at the end of May, compared with 2.64 million in April, while female students' accounts rose to 2.61 million from 2.54 million over the same period.
Of the total deposits held by school students at the end of May, Tk 14.41 billion was in urban accounts and Tk 5.87 billion in rural accounts.
Banking-sector insiders said scholarships and financial assistance channelled through formal banking systems every year are also contributing to the expansion of student banking.
Bangladesh Bank launched the school banking programme in 2010 to bring students into the formal financial system and develop their savings habits and financial management skills.
Students began depositing money through the scheme in 2011. In its first year, 29,080 school banking accounts were opened.
Currently, 59 banks offer school banking services.
Initially, students aged 11 to 17 were eligible to open such accounts. Bangladesh Bank, however, raised the upper age limit to 25 through a directive issued on February 9 this year.
The change brought around 1.34 million additional students into the banking system during the first quarter of the year, according to the central bank.
The central bank has recently directed every bank branch across the country to provide banking services to at least one educational institution in its vicinity.
Banking-sector insiders believe the initiative is also encouraging more students to open accounts.
School banking accounts offer several concessions, including reduced or waived fees and charges, free internet banking, exemption from minimum balance requirements and relatively low-cost debit cards.
An account can be opened with a deposit of as little as Tk 100.
Banking-sector insiders said the recent increase in the maximum age limit has widened the pool of eligible students, while the requirement for banks to serve nearby educational institutions could accelerate the growth of both accounts and deposits.
The steady rise in student savings indicates growing participation of young people in formal financial services, even as households continue to remain under pressure from high living and education costs.
