How to Analyze Project Risks At a basic level, there are three things you should consider when assessing project risks: risk probability, risk impact and risk exposure. These three things can be estimated through qualitative and quantitative risk analysis. Risk Probability All risks have a certain probability of occurrence, which means they might or might not happen. Estimating risk probability isn’t an exact science, but there are several techniques you can use, such as examining data from past projects. By analyzing similar projects from the past, you can better determine whether there’s a high or low chance of project risk. Risk Impact Consider the type of risk and its potential impact on the project. Some risks will bring financial stress, while others might involve resource management issues or delays to the project schedule. To make things simple, you can simply assign levels of impact for your project risks, such as low, medium or high depending on how critical they are. Risk Exposure Risk exposure combines risk probability and risk impact in one formula that’s used by businesses to determine whether they’re ready to assume a potential risk or not. This technique can only be used when you can measure the potential losses associated with risk. The risk exposure formula is: Risk Exposure = Risk impact * Risk probability So, if a given risk had an impact of $1 million and the probability of that risk was 50%, your risk exposure would equal $500,000. What Is Qualitative Risk Analysis? Qualitative risk analysis refers to the risk analysis tools and techniques that rely on expert subject matter opinions, subjective and non-statistical means to assess the likelihood and impact of project risks. A risk matrix is a typical example of a qualitative risk analysis tool. What Is Quantitative Risk Analysis? By contrast, quantitative risk analysis is a statistical analysis of project risks. While it takes longer than qualitative analysis, quantitative risk analysis tends to be more accurate as it relies on data. Some examples of quantitative risk analysis tools are linear regression models or the Monte Carlo simulation, both statistical techniques that simulate scenarios and their different outcomes so that managers can better understand how risk can affect their business or project. Let’s take a closer look at some risk analysis tools and techniques you can use. 8 Project Risk Analysis Tools & Techniques There are several risk analysis methods and tools that help managers through the analysis and decision-making process. Some of these involve the use of risk analysis tools such as project management charts and documents. Let’s dive into these risk analysis methods and how they can help you. 1. Team Brainstorming Sessions Estimating risk probability and impact is a huge part of risk analysis. As stated, this can be done subjectively, which might lead to error, especially if you do it by yourself as the project manager. To avoid this, you can inv

1. Fintech for Financial Inclusion
Faisal Ahmed
Chief Economist
Bangladesh Bank

2. Outline
• The Bangladeshi context
• The Macro Overview – Parameters for Financial Inclusion
• Fintech for Financial Inclusion: MFIs/Mobile Financial Services (MFS)
• Challenges and Lessons

3. TheBangladeshi context…
30
%
28%
GDP
Demographics
50%
<
25
yr
125
m
Mobil
e
Technology
• From a low-income agrarian society at its birth in 1971, Bangladesh is now a lower middle-income
country of 160 million people in the midst of critical transitions. Population density and size
fostered financial innovation and inclusion, including through microfinance.
Urbanization Industrialization

4. Growth has been bottom-up, driven by young, rural firms
• Recent transformations, fuelled by dynamic rural non-farm sectors
(enterprise numbers more than doubled in last decade)
63
37
29
Economic Units
(In percent of total)
71
2001 2013
Rural
Urban
7 13 80
Before '90 During '90s After 2000
Units by Y
ear of Inception
(In percent of total)

5. Financial inclusion through microfinance institutions
• 700+ MFIs and 37 million active borrowers in Bangladesh
Digitiztion through the DFS Wallet
(BRAC and Shakti examples)
0
5
10
15
Tanzania Nigeria Sri Lanka India Kenya Phillippines Bangladesh
Borrowers
(In percent of population)
24
0
5
10
15
India Tanzania Nigeria Sri Lanka Phillippines Bangladesh Kenya
Depositors
(In percent of population)

6. Financial inclusion through mobile financial services (MFS)
12
22
30
39
55
64.0
60
0
20
40
60
80
De3
c '12
Dec '11 Dec '13 Dec '14 Dec '15 Dec '16 Dec '17 July '18
Clients (In millions)
Clients (In percent of adult population)

7. Financial inclusion improved the quality of growth
• Inclusion minimized inequality: lower than the start and lowest among the peers.
0
10
20
30
40
Cross-Country Gini Coefficients
50
0
10
20
30
40
1973 1992 2010
Gini Coefficient : Bangladesh

8. Bottom-up growth and financial inclusion boosted savings
0
10
20
30
Cambodia Thailand Pakistan Sri Lanka Brazil Vietnam India Bangladesh Indonesia
Savings
(In percent of GDP)

9. …and supportedfinancial deepening.
• Bangladesh ranks well in terms of its financial depth.
0
20
60
Tanzania Kenya Mexico Indonesia Sri Lanka Nigeria Phillippines Bangladesh India
Domestic Credit
(In percent of GDP)
Median Emerging Market Depth
40

10. Fintech replicates population density and
aggregates through connectivity

11. Fintech and Financial Inclusion
• Fintech and upgrades of financial infrastructure – BACH, BEFTN, NPSB
and RTGS;
• Bangladesh Bank provided two types of DFS licenses to serve the
customers:
• Mobile Financial services (MFS) [unbanked, bottom-of-pyramid];
• Payment Service Provider (PSP) [banked, affluent/middle-class];

12. Fintech for upgrading MFIs (savings, credit, insurance)
• Over 700 MFIs including Grameen Bank, BRAC
• Only credit and savings facilities, some insurance, no payment service
• Cash-intensive and labor-intensive, so efficiency is constrained
• 17,000 branch network all over the country
• Reached 20% adult and 38% poor HH

13. MFS Market Status
Source: BangladeshBank, Intermedia (June2018).
16%
38%
41%
Salary Disbursement… 2%
Utility Bill Payment
(P2B)
1%
Government
Payment
1%
Merchant
Payment
1%
Others 2%
Cash In
Cash Out
Send Money
MFST
ransaction Mix
64mn
registered
accounts
18banks
provide
MFSservice
994crore
BDT average
daily
transactions
6.4mn
transactionsdaily
30.6mn
active accounts
8.4lac
agents
94%
local
remittance

14. MFS and PSP License Comparison
Mobile Financial Services(MFS) Digital W
allet (PSP)
T
arget customer Unbanked (bottom of pyramid) Banked customers (middle-class, affluent),
stores/merchants
Account opening P
aper KYC Electronic KYC(secondary KYC) based on
bank account or credit card
Primary usage Basic financial service: cash in/out, P2P,
mobile recharge, bill pay
Digital payments: add money frombank
account/card, retail payment, P2P,bill pay,
online purchase
Retail agents and cash
in/out
🗸 -
Businessownership subsi
Bank-led (ba
hareholding
nk diary with at least 51%
s )
Fintech companies
MFS = PSP + cash
in/out
(using agents)
Pape
r
KYC
Mobile Financial Services (MFS) Digital Wallet (PSP)
Target customer Unbanked (bottom of pyramid) Banked customers (middle-class, affluent),
stores/merchants
Account opening Paper KYC Electronic KYC (secondary KYC) based on
bank account or credit card
Primary usage Basic financial service: cash in/out, P2P, Digital payments: add money from bank
mobile recharge, bill pay account/card, retail payment, P2P, bill pay,
online purchase
Retail agents and cash
in/out
🗸 -
Business ownership Bank-led (bank subsidiary with at least 51%
shareholding)
Fintech companies

15. Designing the MFS Regulations
• Bank-led Model; Guidelines in 2011
• 18 MFS providers, two have lion share
• Interoperability among MFS and with other payment systems;
• Client can open an account by filling up a short KYC
• Used to transfer money/remittance, pay bills, get salaries, pay merchant,
and to get social benefits.
• Used by other financial organizations like Banks and MFIs to disburse
credits and get repayments.

16. Lessons andChallenges …
• Behavioral shifts for DFS adoption, innovation and risk management;
• Co-ordination among various related stakeholders i.e.
• collaboration between public and private sectors;
• Careful regulatory and oversight framework-both from BB and from
internal control and compliance of bank/non bank DFS;
• Finding the right balance to encourage innovation and to ensure consumer
protection by right regulations (especially for insurance);
• Financial literacy in all layer of Payment systems-for regulators, for
participants and also for end-users.

17. Thank You