Page 50 - IBT December 2020

Future is now
Green Delta Insurance
Company presents -
Instituting InsurTech
in Bangladesh:
Episode Four
The fourth episode of the series shed
light on fueling InsurTech in Bangladesh
through youth and the startup platform.
By Asif Tarafdar
The fourth and final webinar on InsurTech,
jointly organized by Green presenter, Bijon
Delta Insurance Company Limited and ICE
Business Times shed light on the topic: Fueling
InsurTech in Bangladesh through Youth and
Startup platform. The Keynote of the session
was presented by Bijon Islam, Co-founder and
CEO, LightCastle Partners Limited. N M Zeaul
Alam PAA, Senior Secretary, ICT Division,
Government of Bangladesh as
the Guest of Honor of the panel. Along with
them, there were three more the challenges
panelists: Md. Zafar Iqbal NDC, Director (BIA),
Additional Secretary, Financial Institutions
Division, Ministry of Finance, Government of
Bangladesh; R H M Alaol Kabir, Assistant Senior
Secretary, Senior Consultant, Research and
Innovation Specialist, iDEA Project, ICT Division
and Syed Almas Kabir, President, BASIS.
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almost equal to China in 2005. The emergence of active Angel Investment players such as ease of access to debt the money unless they profit, unlike of current technologies; for example, sector. the demands of a technology-driven ecosystem" to encourage startup
any farmer in a remote location of our
Most ICT companies operating in th
transformation. There are now a lot of
How can we increase
finance, reducing the cost of doing
banks or NBFI. Investment in startups
Networks, Impact Investing, host of
final consumption expenditure, which
accounts for private consumption and local and international operating business, ease of doing business, requires more risk capital; therefore, country can complete his/her financial literacy among issues to be resolved in the insurance country are relatively new
general government consumption, has
fiscal policy support - VAT/tax
angel investors or venture capitalists
transactions through Union Digital
accelerators/ incubators propelled
the expansion stage. BASIS is
sector. InsurTech is a new domain,
the country's youth and
been growing positively for the last
and we (FID) are requesting IDRA to
exemptions and rebates. An enabling
assisting them in enhancing their
Centre if a personal device is
more than one thousand active
are more inclined to invest in the
ten years. The economy is on track in Startups, generating more than 1.5 policy will promote the growth of ecosystem. unavailable. Bangladesh Bank is promote InsurTech in the come forward with ideas that will be growth by facilitating access
graduating from the LDC status in
million- embracing startups' products
different types of finance. We are
incorporated to form a policy. We have
startups and the ecosystem attracting
InsurTech is a relatively new sector
working toward establishing an
context that IDRA should
conducting workshops for the HR
foreign investment in the ecosystem,
with immense potential; there are
integrated digital platform for
maintained very strong
and services part of the country's
2024 and has made impressive
human development strides. PwC, a everyday life. Additionally, BSEC benefiting its growth and employment multiple examples of successful financial transactions, which will also set up an incubation communication with IDRA to take development of these entities. Mos
proliferate InsurTech. Customer
(Bangladesh Securities and Exchange
rate.
global consultancy, also predicts
implementation of the concept across
importantly, we provide
their input and direct on different
facility and policies to
service delivery can completely be
Commission) has also approved
the world. Hopefully, we will be able
complimentary legal and IP assista
regulatory issues. InsurTech will play
Bangladesh to become the 28th
largest economy in the world by 2030 small-cap stock exchange guidelines, Fund of Funds: Startup Bangladesh to emulate them for Bangladesh. automated with our existing license to the insurance a pivotal role in our economic to ensure that they can smoothly
and the ICT Ministry can form a fund
companies?
development and maximizing
solve legal and intellectual right
infrastructure. Insurance companies
which is a big step towards providing
of funds through a public, private
GROWING TECH SAVVY investors with Startup exits. collaboration to invest in Startups. can work with startups to implement The level of financial literacy is financial inclusion. Therefore we are disputes.
POPULATION GOVERNMENT SUPPORT: The fund of funds makes downstream InsurTech with efficiency. Our currently satisfactory. However, we eager to work together in its There are immense opportunities f
Honorable Prime Minister has formed
implementation and execution.
need to focus on InsurTech and its
local ICT companies to work with
Our tech adaptable young population The Government of Bangladesh investments in venture capital and Startup Bangladesh Limited Company, MD. ZAFAR IQBAL NDC potential to impact lives across the insurance companies on InsurTech
alternative investment funds that
(under 35 years) amounts to 62% of commenced the National ICT Policy in invest in startups. which is providing venture capital to Director (BIA) country. Currently, the banking sector and thrive together. AI, Chatbot,
the population. Concurrently, it also
Additional Secretary
has an expanding middle-class 2009 to become Digital Bangladesh by Investor Bene ts: The government the startups. The ICT division is ready Financial Institutions Division is far ahead of its insurance Machine Learning, and Big Data are
population growing at 10% and is 2021. Government policies and needs to ensure an to offer assistance to the insurance Ministry of Finance counterparts, and InsurTech will play changing the insurance industry's
companies and the startups to ensure a pivotal role in increasing consumer perception among the general
expected to reach 34 million by 2025. projects from the ICT Ministry, such as investment-friendly environment in Government of Bangladesh
The crucial aspect of our economic iDEA Project and Startup Bangladesh Bangladesh. Recommendations would the wide use of InsurTech among the confidence in the industry. I have population across the globe.
growth is that it is supported by mass Limited with 100 crore BDT (USD 11.5 be to update the Foreign Exchange general population. According to my observation, the noticed that people are not interested Technology also enables companies
mobile and internet connectivity. The Million) funds, are taken to improve Regulation Act 1947, reduce entry adaptation of technology in the in buying insurance because of the perform more accurate modelling,
pandemic has also accelerated the use the local startup ecosystem. barriers, introduce Tax benefits and insurance sector has been sluggish. lack of transparency in the policies provide better service, and ensure
of ICT technology, including digital Additionally, GoB is setting up more ease repatriation of foreign investors' Consequently, the adaptation of and the processes. We have to use greater transparency in claim
commerce, education, healthcare, and than twenty eight Hi-Tech Parks, profits to attract foreign investments. InsurTech among the operating technology to make the industry and settlement. If a win-win partnersh
agriculture. including infrastructure support like Ease of Doing Business: Business companies has been rare. Big its operations more transparent. between the new tech startups and
data centers, to support technology processes, policies, and regulations companies have repeatedly failed to Also, if provided license, microfinance insurance companies will
DEMOGRAPHIC BULGE WITH companies. have to be streamlined to be more N M ZEAUL ALAM PAA produce a comprehensive database of operators across the country can offer revolutionize both the sectors and
insurance policies, contributing to
THE RIGHT SKILL SETS : convenient to start and operate Senior Secretary their clients. The contribution of the increasing insurance penetration. BASIS will be glad to execute it.
Currently, Bangladesh generates more COVID -19: FALL IN REVENUE startups/SMEs. A way forward could ICT Division sector towards Bangladesh's GDP is less Therefore, there is no better way to
than five thousand IT graduates each AND FUNDING be to use technology and fintech Government of Bangladesh than one percent. It is one of the lowest increase insurance penetration in the Non-bank or bank loans
year, which helps create a strong Since March 2020, the startups have platforms to make tax payments in South Asia. We understand that the country than broadening people's SYED ALMAS KABIR might prove very costly
group of entrepreneurs focused on been affected drastically by the seamless, transparent, and secure. Our journey towards digitalization industry is operating in a very knowledge about the sector. There will President for startups. How can we
solving critical problems. Our median pandemic disruption. More than COV-19 Startup Support Fund: The started from nothing in 2009, and our conventional way in the country. I be demand for insurance once the BASIS
age of 27.9 years means more young twenty-four percent of companies ICT ministry can establish a BDT 150 Honourable Prime Minister's believe the insurance sector has enough companies use innovation to design ensure VC funding for
people are willing to take risks and reported to have stopped operations, crore startup support fund. It can be endorsement of the transformation absorption capacity to implement products according to their I want to restate the fact that the local startups?
BIJON ISLAM explore innovations in the economy. with 56 % of startups seen at least a disbursed through grant/ quasi-equity/ has been pivotal for its success. Her technology identical to developed necessities. The latest technologies, proliferation of Digital Bangladesh Traditional loans can, in
nations. If we can study and emulate
50 % drop in revenue generation. A
mindset has enabled the digital
since 2009 has allowed us to continue
With limited opportunities for STEM
very costly for startups. However,
matching fund nature to support the
The keynote Co-founder and CEO graduates, they are looking into total of sixty percent of Startups have 150 startups for a runway of more revolution to spread across the the successful insurance companies in including AI, Big Data, and IoT, can with our lives throughout the funding has not yet gained popul
perform more accurate surveys and
LightCastle Partners Limited forming ICT enabled companies and a runway of fewer than three months, than a year. Based on multiple country; now, it is time to take it the world, it is possible to change the ensure a better quality of service. pandemic. Digital Bangladesh in our country. Conversely, the
Startups. NRBs (Non - Resident threatening 1.5 million employment criteria, i.e., employment, market further. general people's mindset towards the Therefore, firstly, we have to inform mandate was a foresighted approach government can provide var
Islam,started Bangladesh startup Bangladeshis) are also bringing in and an annual loss of over USD 53 potential, and post-pandemic adjusted sector. We (Finance Ministry) maintain the customer about insurance and its by our honourable Prime Minister that incentives to catalyze t
the session by ecosystem is coming of both investment capital and Million in 2020. However, the valuation, startups can be categorized How can the ICT division regular communication with IDRA. benefits, and then the companies need has allowed our economy to survive They might include tax red
divulging the age riding on critical knowledge remittance, proving crucial disruption is also propelling as- small, medium, and large. However, the same cannot be said for to assure them of competency and and thrive through the use of ICT. rebates. If the practice can be
for the sector's robust growth. accelerated digital services adoption assist in implementing the insurance companies. We feel there transparency. Concurrently, our startup culture is incentivized, it will become
current startup drivers: with Digital Financial Services, How can VC funding and InsurTech through the is a lot to be done for the sector. IDRA thriving, and young innovators are our startup ecosystem. Subseque
ecosystem of Bangladesh, the 39th largest economy STARTUP ECOSYSTEM AT AN Logistics, and Grocery on -demand, low-cost loans be facilitated startup ecosystem? has commenced the Unified Messaging bringing new ideas that are catalyzing ESF is another fund by the
and one of the fastest-growing INFLECTION POINT EdTech, HealthTech seeing steep for those eager to invest in Platform (UMP) to ensure accurate Can we expect IDRA and socio-economic progress. Our young Bangladesh Bank which provides
the country, countries, showed an impressive The Bangladesh Entrepreneurship growth. InsurTech? Since its inception, the ICT division documentation after policies are FID to accommodate initiators and entrepreneurs have loans to startups at a 2% rate,
annual GDP growth rate of ~6.5% over Ecosystem is at an inflexion point I want to clarify that VC funding is not has been assisting various sectors in finalized. However, the insurance InsurTech in the already raised foreign investments including the option of a grace
it is faced with the last decade. Since then, the with an excess of USD 200 million in RECOMMENDATIONS: cheaper than bank or NBFI loans; they becoming more efficient through companies have been hesitant to get on worth more than 200 million USD.
country’s annual GDP growth rate international investments from Startup Policy: are entitled to take large chunks of digitization. Consequently, it is the board, much to the sector's peril. insurance sector by Innovation is pivotal for the success
in the post officially surpassed that of India’s in big-name corporate investors and With the Digital Bangladesh agenda in profit from the company. However, the right time to digitize our insurance Therefore, without the adaptation and drafting new policies? of the current initiatives. We have to
pandemic 2016 and has been higher than that of venture capitals, investing in Government's core, it is eminent to risk-sharing structure in VC funding is sector as internet connectivity has implementation of the latest We are currently at the learning stage make our youth more innovative, and
world and the its neighbor. GDP per capita has been industries like FinTech, Logistics, and form a startup policy to offer multiple very convenient for startups. They become available at Union levels technologies, this sector will be of InsurTech, and the insurance it requires bringing some changes in
growing at rates over 5% since 2015, Mobility the last four years. The benefits for the startup and ecosystem (startups) are not bound to pay back across the country. Therefore, we have lagging. Digitalization will ensure companies are evolving to adapt to our educational infrastructure.
way forward. peaking at USD 1,855 (as of 2019), the infrastructure to make proper use transparency and competency of the BASIS has established a "growth