Answer the questions below referring to the following passage:
Agent banking is playing an instrumental role in serving the unbanked under the formal banking umbrella of Bangladesh. A commercial bank has to absorb enormous fixed cost to establish its branches at remote locations. Agent banking offers a low-cost solution in this regard.
Even though, both agent banking and MFS (Mobile Financial Services) foster financial inclusion; their modus of operation are different. MFS is mostly payment services, but agent banking is basically a limited-purpose banking solution. MFS platform only allows varieties of payment services like cash-in, cash-out, person-to-person (P2P) Iransactions etc. On the other hand, agent banking is a limited-purpose retail banking solution and it covers banking facilities like deposit taking, loan documentation, and other paper work facilities. Unlike the MFS mechanisms, agent banking can easily be regulated and operated within the traditional banking eco-system. Access to payment service is often termed as an elementary-level human right; MNOS (Mobile Network Operators) have the competitive edge (technological set-ups and vast reach) to run payment-services successfully. So, payment services need to be an MNO-territory.
Can 'Agents' or 'Sub-agents' replace bank branches someday? As per the existing legal framework, it is not possible. Moreover, from 'adverse selection' and 'moral hazard' perspectives, these practices should be prohibited. So, in the coming decades, we can expect more and more agents and sub-agents offering limited-purpose banking solutions to the unbanked ones.
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