Ready before the river rises: A new public-private financing model for protecting communities in Bangladesh
Photo: Lai Ming So / World Bank
Jamuna is one of the largest and most dynamic rivers in the world. It provides a lifeline to millions of people, Bangladeshis who farm its banks, fish its waters, and build their homes along its shores. Yet, the river is a paradox. The same river becomes a force of devastation when the rains come heavy— washing away harvests, livestock, and livelihoods, displacing people and pushing them to poverty in a matter of days.
For the communities most dependent on the Jamuna, flooding is not a distant risk. It is a recurring reality. While the government has always found ways to support communities after floods, there is momentum to strengthen government’s financial preparedness – by prearranging finance and putting in place systems in advance – to provide more timely assistance to flood-affected communities. Furthermore, this people-centered approach comes alongside increased investments in river stabilization, connectivity, and development of economic corridors to address, which allows the government to strengthen its fiscal, physical, and social resilience.
The current financing landscape
Bangladesh is not without resources when it comes to flood response. The country mobilizes post-disaster budgetary support and has a well-developed network of humanitarian partners with established anticipatory action programs — pre-arranged cash transfers that reach vulnerable households before a flood strikes, giving families time to move livestock to higher ground, relocate, and cushion the financial blow of disrupted livelihoods.
What these programs cannot do, on their own, is fully close the gap. A landscape mapping exercise conducted by NIRAPAD, a local NGO brought on board to assess humanitarian needs along the Jamuna River, found that current assistance from government and partners covers only a fraction of what affected communities need to rebuild dignified livelihoods. The estimate: at least three times more support is required than is currently being provided. Bridging this gap will require not only increased public resources, but also a systematic approach to mobilizing private capital at scale—particularly long-term financing instruments that can absorb and transfer risk efficiently.
The start to a new beginning
The government, in partnership with the World Bank and with support from the Global Shield Financing Facility, has designed what it calls a "continuum of support", a two-instrument financing package that layers government resources on top of existing humanitarian delivery systems. For 2026, the program covers 100,229 households, about 420,000 people in three districts—Gaibandha, Kurigram, and Sirajganj.
The first instrument is a parametric insurance solution, mobilizing private risk capital. The product was developed with technical support from Weather Risk Management Services and underwritten by the Sadharan Bima Corporation (SBC) with reinsurance coverage from Generali. A maximum coverage of US$6m has been secured for the 2026 flood season.
By transferring a portion of disaster risk to international reinsurance markets, this financing also demonstrates how Bangladesh can leverage global private capital to strengthen domestic insurance markets and over time, its longer-term resilience. We see countries doing this world over – be it Laos accessing coverage for floods – or Malawi accessing coverage for drought.
The second instrument is a community protection fund with GoB allocation, also structured around index-based triggers, and hosted by Janata Bank, designed to activate for smaller flood events that fall below the insurance threshold — and to cover rainfall-driven losses that parametric insurance may miss.
Critically, both instruments are built to plug into existing delivery infrastructure. The Government has partnered with the World Food Programme to leverage their on-ground networks, ensuring cash assistance reaches the last mile efficiently and through digital channels communities already trust.
Learning and adapting – Bangladesh knows this too well
This marks the first time the Government of Bangladesh has used a market-based instrument to expand its disaster response financing capacity. And developed a systems approach for more rapidly providing cash to beneficiaries.
There may be challenges in the early years, as there are with all new innovations. Therefore, the coming years are expected to be years of learning — opportunities to refine triggers, expand coverage, and build the evidence base for what works. The longer-term goal is to embed these financing mechanisms into Bangladesh's national systems, linking future instruments with the country's own social protection programs, such as vertical and horizontal expansion of the Employment Generation Program for the Poorest.
For the millions of people who call Jamuna’s banks home, the river will always carry risk. The question has never been whether floods will come — it's whether support will be ready when they do.
The solutions are developed as part of the Jamuna River Sustainable Management Project (JRSMP). At the heart of the project is a simple but powerful insight: the communities most vulnerable to flooding are also the least able to absorb its impact. Which is why mobilizing public and private finance remains critically important to provide timely and targeted assistance to these communities.