The school banking programme introduced by the Bangladesh Bank in 2010 is growing in popularity among students, with the deposit base and the total number of accounts both showing an increase in recent times.

As of June, the total deposits in the bank accounts owned by schoolchildren stood at Tk 1,128 crore, up 28.18 percent from a year earlier. During the period, the total number of accounts rose 12.86 percent to 13.34 lakh.

Dutch-Bangla, Islami, Eastern, United Commercial and Rupali were the top five banks that pulled the most deposits from students.

With a view to encouraging citizens to start saving from a young age, the central bank in November 2010 instructed all banks to allow schoolchildren of 6 to 18 years of age to open accounts that come with regular banking services.

Of the 57 banks in Bangladesh, 56 are now running the programme.

The account is opened as per the guidelines of the existing Uniform Account Opening Form and Know Your Customer form of the central bank.

Attested copies of the child's birth certificate, school ID card or certificate from the head of the educational institution and the latest fee payment slip are needed as supporting documents.

The account will also carry the signature of the child's legal guardian.

The minimum balance ranges between Tk 100 and Tk 500 depending on the bank.

The educational institutions can collect the student's fees straight from the accounts.

The banks, meanwhile, can provide the child education insurance under the account so that they can get financial help in case of necessity. The students can open various savings schemes under the programme as well.

The deposits under the school banking accounts increased in recent months as banks have taken a number of initiatives to facilitate the opening of such accounts, said Md Abul Bashar, general manager of the BB's Financial Inclusion Department.

Some of the banks organised school banking conferences at different educational institutions to encourage a habit of saving from a young age.

Banks usually give 1 percent more interest on the deposits in the student accounts than they offer for other savings products, he added.

Mamun-Ur-Rashid, managing director of Standard Bank, said all the branches of his bank open such accounts to help achieve the central bank's financial inclusion objective.

“We have set a target for such account for all our branches,” he said, adding that Standard opened more than 3,000 accounts between September last year and October this year.

Bank Asia has recently made an agreement with Brac, a non-governmental organisation, to expand the school banking programme in different parts of the country, according to Md Arfan Ali, managing director of Bank Asia.

Brac had earlier sponsored to set up libraries in many schools.

The librarians will act as agent of Bank Asia to bring the students under the programme.

Bank Asia has also set a target of enrolling 3,000 schools with the school banking programme over the next three years, Ali added.