Abstract
<title>Abstract</title> <p> Agent banking has become an innovative approach in Bangladesh to provide financial inclusion and reach the unbanked and under banked through financial services. This study investigates the factors that influence the agent banking branch to disburse loans and advances, and finds out whether the agent banking has become a new dimension of inclusive banking. The study aims at exploring the impact of agent banking <bold>-</bold> specific and macro-economic variables on Agent Loan Disbursement using panel data analysis of 30 scheduled commercial banks during 2015 <bold>–</bold> 2024 who operate agent banking services. In order to provide robustness, the study uses Random Effects regression model, Fixed Effects regression model and Pooled Ordinary Least Squares (OLS) regression model. According to the empirical results, Agent Banking Outlets and Agent Banking Deposits are statistically significant and positively related to Agent Loan Disbursement in all estimation models. The findings showed that the presence of agent banking networks and mobilization of deposits via agent banking channels is the key drivers that have a significant positive impact on banks’ lending capacity and access to formal credit. The effect of inflation is also found to be positive and significant on loan disbursement, which indicates that the demand for credit through agent banking is higher during inflation period. The study concludes that agent banking is no longer a mere financial inclusion transaction model but it is an effective platform for inclusive banking. The findings underscore the need to broaden the agent network, increase deposit mobilization, and improve digitization financial infrastructure to ensure sustainable and financial inclusion and rural economic development in Bangladesh. </p>