Payment and Settlement System Bill, 2024 passed

The "Payment and Settlement System Bill, 2024" was passed in parliament on Tuesday, aiming to bring bank and non-bank payment services under a legal framework.
During the discussion on the bill, the opposition and independent lawmakers opined that the banking system in the country was in a mess due to the lack of enforcement of rules by the concerned authorities.
Moving the bill along with a report of the parliamentary committee concerned, Finance Minister A H Mahmood Ali said that the bill is to protect the interests of customers as there is no existing law regarding payment and settlement systems in Bangladesh.
All payment and settlement systems are now managed under the "Bangladesh Payment and Settlement Systems Regulations, 2014 and Regulations on  Electronic Fund Transfer, 2014" by Bangladesh Bank, according to Article 7A (e) of the Bangladesh Bank Order, 1972.
As there is no separate law in this regard, the banks are conducting activities by contracting with Bangladesh Bank under "The Contract Act, 1872" in order to comply with the regulations described for participating in various electronic transaction systems, the finance minister said, explaining the objectives of the bill.
In addition, there is currently no law regulating the payment activities of non-bank financial institutions (NBFIs), he said.
The amendment proposals brought by some opposition lawmakers were rejected by voice votes.
According to the bill, any banking company cannot participate in any payment systems, operate payment systems or provide payment services in electronic currency without obtaining approval from the Bangladesh Bank.
It also said, no person, institution or company can issue or buy and sell 'Prepaid Payment Instrument' without obtaining approval from the central bank.
Without approval from the Bangladesh Bank, any type of investment taking, lending, deposit or financial transaction through online or offline is prohibited.
According to the bill, violation of these shall be offences and shall be liable to imprisonment for a term not exceeding five years or Tk 5.0 million as fine or both.
"If any person is required by or under any provision of this Bill or In pursuance of his purpose, in any statement, report or other document or information called for or filed, wilfully and knowingly furnishes false information or statement on any material matter, or, wilfully and knowingly, omits to furnish information or any statement on such matter; If so, it will be a crime, and for that that person will be punished with imprisonment not exceeding three years or fine not exceeding Tk 3.0 million or both," reads the text of the bill.
It also stipulates that if any person contravenes any other provision of this proposed law, or contravenes any order or direction made or any condition imposed or any provision of any rule or regulation made thereunder, such contravention shall be an offence and shall be liable to imprisonment for a term not exceeding three years shall be punished with imprisonment, or with a fine not exceeding Tk 3.0 million, or with both.
From now on, all crimes will be cognisable, non-bailable and non-compoundable.
State Minister for Finance Waseqa Ayesha Khan, placed the bill in parliament in May last and then it was sent to the Parliamentary Standing Committee on the Ministry of Finance for further examination.
Meanwhile, during the discussion on the bill, lawmakers who brought the amendments said that despite having a number of rules, the authorities failed to prevent crime in the banking sector.
"How did people like PK Halder robbed financial institutions and laundered the money?" JP lawmaker Hafiz Uddin questioned.
Banks grew like mushrooms in the country, he said, adding that the finance minister should guarantee that depositors of the vulnerable banks would get their money back.
Independent lawmaker Pankaj Debnath told the House that according to a recent report four large groups of the country got an interest waiver of Tk 64.97 billion under special permission of the Bangladesh Bank.
He questioned the transparency of such special permission and said that two state-owned and private banks were becoming sick due to such facilities.
He also pointed out that a controversial NBR official, recommended for the post of the NBR and director of Sonali Bank despite having his political involvement, was exposed 8-10 years ago.
"The question is who recommended him for these important positions?" he said, adding that the identity of these mentors of that NBR official should be unveiled.
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