Bangladesh’s digital payment boom is slowing even as cash-driven transactions surge sharply, with new central bank data showing non-digital payments rising 31 per cent in 2024 – over three times faster than digital growth, revealing a widening behavioural divide in the country’s payment ecosystem.
Bangladesh Bank’s Payment Systems Report 2024 shows that digital transactions volume reached 40.31 crore last year, up nearly 10 per cent from 36.67 crore in 2023. But the total value of digital payments barely increased – rising only 1.6 per cent to Tk76,344 crore.
In contrast, non-digital channels – including cash, cheques, paper instruments and over the counter (OTC) transactions – handled 45.49 crore transactions worth Tk1,95,863 crore, making up almost three-fourths of all money moved across the economy.
The data makes clear that Bangladeshis use digital channels more frequently but still rely on cash for the most significant payments.
Currency in circulation rose to Tk3,04,900 crore, a nine percent jump that shows cash remains deeply embedded in daily and business transactions. Mobile financial services reinforce this pattern: although MFS processed more than 730 crore transactions worth Tk17,38,300 crore, nearly two-thirds of these are cash-ins and cash-outs.
Merchant payments remain stuck at about five per cent, underscoring that digital money often returns to cash at the final stage.
Large-value payment behaviour also remains skewed. The BD-RTGS system continued expanding in 2024, though the average transaction size fell as more mid-value corporate and government payments shifted onto the platform.
Cheques, however, continue to dominate formal high-value settlements, clearing over Tk21 lakh crore last year despite major investments in digital rails.
The Tk21 lakh crore cleared through BACPS represents large corporate, government and interbank cheque settlements across the entire financial system, whereas the Tk1,95,863 crore “non-digital” figure reflects only retail and consumer-level transactions, which is why the cheque total is far larger.
Retail digital channels show a similar imbalance. Internet-based fund transfers through NPSB (IBFT) surged to nearly Tk1,96,100 crore, making it the largest digital retail channel by value. Yet ATM withdrawals still dominate by count, signalling that for most users, digital platforms function largely as a bridge to physical cash.
POS and QR payments remain weak because of limited merchant activation and slow consumer adoption. The central bank’s interoperability platform, IDTP (Binimoy), processed only Tk73 crore in 2024, though usage improved toward year-end.
Digital inclusion gaps remain stark. Payment service provider (PSP) account data shows men hold 94 per cent of personal wallets, while women hold only six percent.
Merchant participation is similarly thin: of 1.45 lakh merchants onboarded by payment service operators, only about 3,600 actively transact, limiting the network effects necessary to scale digital commerce.
Regulators expect the Payment and Settlement Systems Act 2024, stronger licensing rules, a domestic card scheme and updated risk-management frameworks to gradually accelerate digital adoption. But senior officials privately concede to TIMES that Bangladesh’s main challenge is behavioural, not technological. The country has built advanced digital rails at remarkable speed, yet the gravitational pull of cash remains overwhelming.
