In 2017/18 the United Nations Capital Development Fund (UNCDF) undertook the first comprehensive review of micro-merchants in Bangladesh engaged in the retail sector, particularly in Fast Moving Consumer Goods (FMCG) operating mostly in rural areas.

The Landscape Assessment of Retail Micro-Merchants in Bangladesh showed that retail micro-merchants require access to financial services, and credit in particular. Their need for financial services is high, and microfinance institutions are well-placed to meet the growing credit needs of micro-merchants. Micro-merchants predominately borrow roughly 68.1% of total loans from microfinance institutions. With the introduction of digital technologies, microfinance institutions have a new opportunity to further expand financial services to micro-merchants by embracing digital and mobile technologies in their operations.

Keeping the micro-merchant market segment in mind, this report answers the questions of how and why microfinance institutions should make a switch to digital technologies to better meet their customers’ needs.