Family Card: A test of overcoming design deficiencies in social safety net

Bangladesh’s social safety net has always carried two truths at once. On paper, it is large, diverse and politically significant. In practice, however, it is often complex, fragmented and at times inequitable. The government’s new Family Card initiative has once again brought that long-standing tension to the centre of debate. It is being launched as a four-month pilot programme. In the first phase, 6,500 families in 14 upazilas will be included, and each family will receive Tk 2,500 per month through a mobile wallet or bank account.

Supporters see this as a bold, even historic, step. Critics fear it may simply add another large programme to an already crowded social safety net. The core question is not whether the Family Card is inherently good or bad in policy terms. The question is whether Bangladesh can use this opportunity to address the long-standing design and governance weaknesses that characterise its social safety sector.

Two aspects make the initiative politically and economically significant. First, the proposed scale is unprecedented. If the government eventually brings 20 million families under monthly assistance, the potential cost would reach roughly Tk 50 billion per month, or nearly Tk 600 billion annually. This is not an ordinary budget item. It is a macroeconomic commitment that will shape revenue and expenditure priorities for many years.

Second, the proposed framework goes beyond cash transfers alone. According to the draft guidelines, there are plans to establish a dynamic social registry, integrate the existing TCB (Trading Corporation Bangladesh) cards and eventually transform the Family Card into a universal social identity by 2030. At the same time, there is an ambition to raise the social protection budget to 3 per cent of GDP by 2028. If implemented in a realistic and well-governed manner, these goals could offer Bangladesh a way out of a long-standing problem: a social protection system that has grown in fragments and lacks coherence.

At present, Bangladesh operates more than 100 social safety net programmes under roughly 25 ministries. Budget allocations are estimated at about 1.9 per cent of GDP. Such breadth is not automatically a strength. More often, it results in duplication, inconsistent eligibility rules, administrative waste and opportunities for manipulation of benefits at the local level.

The outcomes are familiar too. Some households receive multiple benefits, while others of similar poverty receive none. Although draft guidelines cited in the media suggest that 22 to 25 per cent of the truly poor are excluded, various studies indicate that exclusion errors may be more than double that figure. When exclusion errors are so high, the ethical case for reform becomes as strong as the technical one.

Three aspects of the Family Card deserve recognition because they align with the need for serious reform. First, the use of the household as the unit. Risks such as food insecurity, health shocks, rent pressures or job loss are shared within families. A household-based structure can reduce the limitations of “one person, one benefit” schemes.

Second, making women the primary beneficiaries. Under the plan, the card will be issued in the name of the mother or the female head of the household. International evidence suggests that when money is placed in women’s hands, it is more likely to be spent on food, health and the wellbeing of children. It can also strengthen bargaining power within households.

Third, a data-driven targeting process. The proposed proxy means testing score, door-to-door data collection, verification by social service workers and the use of QR-coded cards signal an attempt to reduce patronage-based allocation.

Yet design intentions do not automatically translate into real outcomes. That is where the real test lies.

Three risks are particularly relevant here. First, the targeting risk. The Family Card is not a magic solution. It can help, but it can also misclassify households, especially in urban areas where incomes are irregular and assets are informally shared. Bangladesh’s urban poor are often the “working poor”. The inclusion of large slums in Dhaka within the pilot areas is a positive step. However, strong grievance and appeals mechanisms, along with periodic recertification, are essential. If poor households cannot challenge their exclusion, the registry may become another instrument of inequality.

Second, the fragmentation risk. A new programme may deepen disorder. If the Family Card merely adds another cash transfer without integrating older programmes, duplication will grow. The commitment to integrate TCB cards is therefore important. Here lies a clear reform opportunity—to use the Family Card as the “front door” of social protection and gradually rationalise overlapping benefits behind it. This will require political courage, because consolidation often disadvantages intermediaries rather than the poor.

Third, the fiscal risk. An annual expenditure of Tk 600 billion must be financed sustainably. Well-targeted, regular social spending linked to human development can stabilise an economy. It helps sustain consumption, protect nutrition and reduce the pressure to sell assets during shocks. But if expansion outpaces revenue capacity, it may turn into a fiscal trap. A transparent medium-term financing plan is therefore essential, clarifying how much will come from reallocations, how much from new revenues and how much from efficiency gains.

The National Social Security Strategy (NSSS) is built on a life-cycle approach. Different stages of life require different forms of support. A single card can be a powerful delivery platform, but it is not a strategy in itself. Large cash programmes should not overshadow initiatives such as maternal nutrition, disability assistance or child-focused services. The Family Card should therefore be viewed as infrastructure: build the registry, strengthen payment systems and improve verification, and then attach benefits—such as nutrition support, education stipends, climate-sensitive assistance or portable benefits for migrant workers—according to need.

If the Family Card is to become a genuine instrument of reform, five commitments may serve as benchmarks of success. First, a single dynamic social registry used by all ministries, with clear rules on data protection and access; second, a consolidation roadmap—announcing at the outset which programmes will merge, which will be phased out and how current beneficiaries will be protected during the transition; third, independent monitoring and open dashboards showing inclusion and exclusion errors, payment regularity and grievance resolution; fourth, urban portability, so that families moving in search of work do not lose benefits simply by changing address; and, fifth, a credible financing plan linked to domestic resource mobilisation and expenditure reallocation.

Social protection is not charity. It is economic policy. When well managed, it strengthens resilience, builds human capital and reduces inequalities that growth alone cannot address. When poorly managed, it becomes a source of waste and political conflict.

* Selim Raihan is a professor of Economics at Dhaka University and executive director of SANEM. He could be reached at [email protected]

* The views expressed are the author’s own.