Introducing digital currency can reduce money laundering: Economists

Introducing the Central Bank Digital Currency (CBDC) can help reduce the amount of money smuggled out of the country every year to a large extent, said economists and accountants at a seminar.

The seminar titled "Economics of Central Bank Digital Currency: Transforming Paper Money to Digital" was held on Monday at the Bangladesh University of Engineering and Technology (Buet).

CBDC is a form of digital currency issued by a country's central bank. It is similar to cryptocurrencies, except that their value is fixed by the central bank and equivalent to the country's fiat currency.

Speakers at the seminar said CBDCs have been introduced in many countries. It is time to raise awareness about this issue in Bangladesh as well. However, before that more focus should be made on building a cashless society. The government must have the political will to launch a CBDC and ensure the protection and security of consumer interests.

In the keynote paper at the programme, Jamaluddin Ahmed, chairman of Emerging Credit Rating Limited, citing various data, said $50 billion have been smuggled in the last six years from Bangladesh through misinvoicing in import-export trade. As 33% of gross domestic product is in the informal sector, recovery of these funds is not possible.

So far, CDBC is operated in 122 countries. The seminar has been organised to raise awareness about this issue in Bangladesh, he added.

Executive Director of Policy Research Institute Ahsan H Mansur said in his speech as a special guest at the event, the central banks of different countries are checking how to launch digital currencies. There are many challenges in this regard. When digital currency is introduced, the state will know who has what in the pocket. As a result, corruption can be reduced if the government wants.

Referring to the prevalence of digital currencies like Bitcoin in the private sector, he said, "Central banks of various countries are observing the cryptocurrency market. Especially, large economies have not yet introduced digital currencies. First of all, we need to create a cashless society. We can make all payments through the mobile app. In the next five to seven years we have to give importance to this area. If the society becomes cashless, the transactions will be transparent, so the revenue collection of the government will also increase."

Prof Satya Prasad Majumder, vice chancellor of Buet, was present on the occasion as the chief guest while Prof Abdul Jabbar Khan, pro vice chancellor of Buet, and Mohammad Muslim Chowdhury, comptroller and auditor general of Bangladesh, were present as special guests at the seminar.