Education as the Bridge from Cash to Digital Wages: Lessons from Garment Workers in Bangladesh

Over the course of a year, MFO in collaboration with the Social Performance Task Force (SPTF), implemented a project that aimed to raise awareness around wage digitization among garment workers in Bangladesh and provide education to those who were either already receiving or about to start receiving digital wages. The project leveraged the strong relationship MFO has developed with garment workers through the Garment Worker Diaries in its attempt to better understand their experience of the wage digitization process and the real-life consequences of receiving their wages digitally. 


Initially, and through Focus Group Discussions (FGDs) with workers who had already gone through the process, we sought to uncover the level of choice, voice, respect, and control[1] given to them as they went through the process to then be able to develop a response based on their needs and concerns. The study revealed that workers entered the process with very little information and very little agency. This suggests that workers are as likely to be disempowered by wage digitization as they are to be empowered, depending on the level of education and information provided, especially when digitization is first implemented. 


To address this issue, MFO produced an awareness-raising poster and education module designed to address the major concerns cited by the workers. After distributing the poster and conducting a number of educational trainings, MFO again conducted FGDs to understand what effect, if any, the poster and module had on the workers. The results suggest that a little information and education go a long way. The poster and education module had a positive impact on workers’ respect, voice, and control, as workers were:

  • less anxious (respect); 
  • more prepared for trainings provided by their factories, able to use the poster inside their factory to engage managers, and able to teach their peers (voice); and 
  • more equipped to use the account securely and efficiently (control)

There was little impact on “choice” because generally wage digitization initiatives do not give workers a choice of financial service provider or type of account.


This is very much in line with the results from a project by Business for Social Responsibility (BSR) and the Bill and Melinda Gates Foundation which provided extensive education on the use of digital accounts in collaboration with factories digitizing their wage payments to their employees. Education has thus proven essential and necessary if wage digitization is going to empower garment workers to manage their money using all the functionalities that a digital account can offer. The feedback from the workers themselves contained clear recommendations about how a successful program of education might work.

  • Training should not be restricted to one communication channel (in-factory training, for example) but should take advantage of multiple, complementary channels. Workers suggested YouTube videos as well as peer-to-peer learning. These are potentially complementary if (in a post-Covid-19 world) workers are able to watch videos together and discuss what they have seen.
  • Training should be on-going and provide workers with ways to remind themselves of things that they have already learned, such as cheat sheets or the availability of a helpline to ask questions.
  • Myths and rumors are widespread and need to be addressed and dispelled.

An estimated 1.5 million of RMG workers in Bangladesh were already receiving digital wages as of November, 2019[2]. Covid-19 has done nothing but increase and accelerate this trend. Factories opened 1.92 million new digital accounts for workers right after the government’s announcement of a loan program for factories to cover workers’ salary payments for the next 3 months, since one of the conditions is that the payments be digital. Though limited in scope and scale, the results of this project provide important lessons for how wage digitization in Bangladesh will or will not empower garment workers and what steps need to be taken, both during and after Covid-19, to ensure the intended beneficiaries are able to understand and take advantage of the benefits of the system.  




[1] The financial services customer empowerment framework developed by the World Bank’s Consultative Group to Assist the Poor (CGAP)—choice, voice, respect, and control—to understand and develop a response to the needs and concerns of garment workers facing the digitization of their wages.