Cenbank directs banks, MFS firms to set up Cashless Bangladesh Unit

The Bangladesh Bank has instructed all banks, mobile financial service (MFS) providers, payment service providers (PSPs) and payment system operators (PSOs) to establish a dedicated "Cashless Bangladesh Unit" at their headquarters.

The move aims to reduce reliance on cash and extend the benefits of digital transactions to customers at the grassroots level, the central bank's Payment Systems Department said in a circular yesterday.

It states that in banks, the overall supervision of the unit will be handled by the deputy managing director or an officer of equivalent rank responsible for payment system operations, while in MFS, PSP and PSO companies, the unit will be overseen by an officer one level below the managing director.

The circular also specifies staffing requirements. Each bank unit must include at least four officers in addition to the unit head, while MFS, PSP and PSO units must have at least two officers.

To ensure coordination with Bangladesh Bank, a focal point officer will be appointed in each unit. In banks, this will be a deputy general manager or equivalent officer, while in MFS, PSP and PSO firms, the focal point will be an officer two levels below the managing director.

For data collection, analysis, report preparation and coordination, an "assistant focal point officer" will be designated. In banks, this should be at least a senior principal officer or equivalent, while in MFS, PSP and PSO firms, the role will be assigned to an officer three levels below the managing director.

Banks, MFS, PSP and PSO companies have been instructed to establish the unit by 31 March and submit a forwarding letter, signed by the managing director or CEO, to the relevant department of the central bank.

Scope of work

The units will be responsible for developing, updating and implementing roadmaps and target-based plans to expand digital payments, including Bangla QR, POS, online and card transactions.

They will also accelerate merchant onboarding through the Bangla QR channel nationwide, while monitoring customer registration and merchant onboarding at branch level via the institution's own apps. 

The units are expected to organise training programmes to strengthen staff capacity and run regular public awareness campaigns, seminars and promotions to increase understanding of digital transactions.

Ensuring customer protection, handling complaints, mitigating risks and coordinating internal controls will be key responsibilities. The units will also innovate and implement sector-based supply chain payment models to build a complete digital payment ecosystem.

An annual report on the implementation of the unit's initiatives must be prepared and presented to the board, with a copy submitted to the central bank along with the board's March meeting minutes by the last working day of the month. 

The units are further tasked with coordinating with ministries, local administrations, city corporations, municipalities, trade bodies and other stakeholders to ensure smooth implementation of the initiative.