A much-hyped transition to cashless society progresses fast in Bangladesh as internet-based banking (iBanking) increased by Tk 508.73 billion or 110 per cent to nearly a trillion in ten months between July and April 2024.
A latest official count shows the total transactions through the virtual banks amounted to Tk 971.172 billion during the period, signifying time saving and convenience against visits to brick-and-mortar bank branches by growing numbers of account-holders.
The number of internet-banking customers stood at 8,524,325 in a rise by over 1.0 million up to April, according to the Bangladesh Bank (BB) data.
Such a high rate reflects customers increasingly switching to electronic fund transfers from the manual banking which needs time and physical presence.
Central bankers say this trend of rising internet banking began in the time of covid-19 outbreak in March 2020-when people kept indoors amid lockdowns.
During February 2020, the transactions were worth merely Tk 62.99 billion, the data show.
Such transaction is mainly urban-based and needs customer literacy and awareness to promote across the country, they think. They say the central bank has been extending regulatory support to the banks.
The rollout of Bangladesh Real Time Gross Settlement (BD-RTGS) and Bangladesh Electronic Funds Transfer Network (BEFTN) by the BB and increased use of android phones also helped a spurt in internet banking.
"This is due to increasing uses of the smart phone," says Syed Mahbubur Rahman, managing director and CEO of the private commercial bank MTB.
People can transact any time of a day. Physical banking has to maintain office working hours, he notes, adding that now many people transfer funds from ATMs.
The banker, however, says there are some risks in such transactions as many face troubles while they share OTP and PIN.
"We are continuously alerting customers not to share PIN and OTPs through short message services."
Emranul Huq, managing director and CEO of Dhaka Bank, told the FE that the corona pandemic had many lessons and digitisation is one.
"Since then, we have continuously been developing ourselves toward cashless society," said Mr. Huq, adding that the central bank has introduced a new QR code in the strides for transition.
The Bangla QR code is another "milestone" towards cashless society.
He mentions that many small transactions in the retail shops can use the Bangla QR code where POS not available.
He says retail transactions are dominating the internet banking. "We are also providing such digital services to the big corporates as well."
Apace with digital banking advances banks are introducing new products.
On the risks of cyber-attacks and fraud, Huq says banks are investing to build firewalls to ensure digital security and protect their systems.
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