Should Bangladesh adopt a digital Taka?

A Central Bank Digital Currency (CBDC) is a digital form of national currency issued by central banks, which has been explored by many nations in recent years. CBDCs are regulated and supported by governments, making them a more secure and stable digital alternative to cash, unlike cryptocurrencies such as Bitcoin. Pilot projects have already been introduced by countries like China (Digital Yuan) and India (Digital Rupee). As digital transactions become increasingly common in Bangladesh, it is crucial to consider whether the country should implement a digital Taka.

One of the main benefits of a digital Taka would be financial inclusion. While mobile banking services like bKash and Nagad have helped expand financial access, millions of people in rural areas still lack access to formal banking. Additionally, a digital Taka could reduce the costs associated with printing and handling paper money, saving the government money in the long run. Furthermore, digital transactions are more secure and traceable, reducing fraud, robbery, and theft. Since digital currency transactions can be monitored, stolen money would be more difficult to use. To minimise the risk of unauthorised access, digital wallets would also require security features such as passwords or biometric authentication.

However, cybersecurity remains a major concern. A digital Taka system could be vulnerable to hacking and fraud if not adequately secured. Another challenge involves commercial banks, as they could struggle to provide loans and investments if too many people shift from traditional banking to digital Taka. Additionally, Bangladesh would need a strong digital infrastructure to support CBDCs, including stable internet connectivity and secure digital wallets.

The government should closely examine the experiences of other nations to assess whether Bangladesh is ready for a digital Taka. A pilot programme could be introduced to evaluate its performance in the local market. If properly implemented, a digital Taka has the potential to modernise Bangladesh's economy, enhance transaction security, and promote financial inclusion. However, meticulous planning and robust cybersecurity measures would be essential for ensuring its success.

Most.Sadia Arafin Maisha

Student

Business Administration- Human Resource Management and Finance

North South University

sadia.maisha@northsouth.edu