Mobile Financial Services Use and Household Resilience in Rural Bangladesh after COVID-19: Mixed-Methods Observational Evidence

The present study examines the relationship between household resilience in rural Bangladesh and different categories of mobile financial services (MFS) use, as reported and categorized based on survey respondents’ responses, following the COVID-19 shock. The study employed a convergent parallel mixed-methods design based on a survey of 300 households in Kurigram, Sunamganj, and Jhenaidah, 12 key informant interviews, and six focus group discussions. In the quantitative part of the study, users of MFS were split into regular users and occasional users, and then each group was compared with non-users. The specified 1:1 propensity-score matching algorithm failed to satisfy a balance criterion. Therefore, the main specification relied on propensity-score overlap weighting, covariate adjustment, and union-clustered standard errors. The use of MFS compared to non-use was associated with 17.42 percentage points lower decline of income, 2.51 points lower food-insecurity score, 14.06 percentage points lower probability of distress asset sale, and 3.88 fewer months to recovery among regular users. Only the decline of income was smaller among occasional users. No statistically significant gender- or income-based interactions were observed after correction for multiple testing. Exploratory decomposition did not support the hypothesized pathways through income smoothing and access to cash in emergencies. Fieldwork notes suggested same-day liquidity, shorter travel and waiting times, and challenges related to digital skills, internet stability, liquidity of agents, transaction fees, and trust. Results of the present study should be considered observational associations, rather than causal effects. Membership in the regular use category of MFS field-coded by field surveys was associated with better reported resilience outcomes, and it remains unclear whether MFS itself leads to such outcomes.