BB governor outlines cashless society plan
Bangladesh Bank Governor Abdur Rouf Talukder has outlined the government's plan to bring about a "Smart Bangladesh" by implementing a cashless society, among other measures.
The government aims to transform 75 per cent of the country's financial transactions to digital platforms instead of using paper money within the next four years, Rouf made the disclosure in the wake of Finance Minister AHM Mustafa Kamal's post-budget press conference on Friday.
This announcement aligns with the budget proposal for the fiscal year 2023-2024, where Kamal emphasised the government's ambition to establish a cashless society in the country.
A pilot programme is currently under way in four districts on a small scale as part of this effort, Rouf said.
QR code payments used to be limited to large shopping centres, but now they are available at the grassroots level, he said,
This means that even small roadside tea stalls and green coconut vendors can accept cashless transactions, he added.
The governor highlighted the introduction of the Interoperable Digital Transaction Platform (IDTP) as one of the recent initiatives to promote cashless transactions. This platform addresses the previous lack of an interoperable system in place.
Rouf explained that with the IDTP, a single code could be used to withdraw money from any payment company using a single machine. This facility allows anyone with a mobile financial service or bank account to make direct payments, according to him.
As the third step, Bangladesh Bank is working towards the creation of a National Debit Card, he said.
"A single card will be used by all banks and financial institutions, and we believe that its widespread acceptance will result in a greater shift from cash to card-based transactions."
Bangladesh currently relies on international institutions like Visa and Mastercard for debit and credit card services, resulting in a substantial outflow of foreign currency in the form of dividends.
The introduction of a debit card system will help reduce dependence on foreign institutions and retain more financial resources within the country.
According to the central bank, in March, customers using debit cards carried out daily transactions worth Tk 13.63 billion through ATM booths and POS machines, resulting in a total transaction volume of Tk 422.59 billion for the month.
Until March, banks issued over 31 million cards.
The governor mentioned plans to introduce a completely virtual digital bank in the country, where customers and bankers will not have physical interactions.
This concept has already been implemented in developed countries. Rouf said that the development of the digital bank is already in progress.
They expect that it will attract young smartphone users, as there are currently 60 million smartphone users in Bangladesh, providing a potential customer base of the same size.
The governor said that the combination of financial inclusion initiatives and the digital bank would accelerate the pace of cashless transactions. �bdnews24.com