Card payment for Uber services to resume after 3.5yrs

Card payments for Uber rides and other services are going to resume after a suspension of three-and-a-half years.

The Bangladesh Bank, in a meeting with representatives from Uber and 10 banks operating in the country yesterday, reached a preliminary decision to make this happen.

"The central bank has given its primary approval to app-based ride-sharing service provider Uber to accept card payments on some conditions," a meeting participant, wishing to remain unnamed, told The Business Standard.

The conditions are taking payments in taka within the Bangladesh border, making ties with local banks or payment service operators and paying appropriate taxes, he said.

"If foreign nationals want to make foreign currency payments through their cards, they can do so. In all cases, payments must be deposited to local banks and Uber can take it out only after paying taxes," the official explained and noted that Bangladeshi citizens travelling abroad can pay for Uber services in dollars using international cards.

The Bangladesh Bank verbally asked all local banks to suspend foreign currency payments options for Uber services within the Bangladesh border in early 2020 on the allegation that the Netherlands-based ride-sharing giant took all of its earnings, nearly $8.41 lakh, to the home country between 2016 and 2019 without approval from the central bank. 

"Although banks were asked to suspend card payments in foreign currency for Uber services within the Bangladesh border they also suspended that for Bangladeshi people travelling abroad as card management systems did not allow many banks to customise country-specific payment options," a senior central bank official told TBS.

"Today, the banks have been called to discuss the issue. A couple of banks said they can maintain domestic and international transactions separately, but most banks can't," he added.

When contacted, Bangladesh Bank Assistant Spokesperson Sarwar Hossain told TBS that the banks stopped card payments for Uber services as they were failing to separate foreign currency and local currency payments. "Today's meeting discussed how Uber payments through cards can be made in local currency in the country and in foreign currency abroad. They must have an arrangement with the local corresponding bank to initiate the payment. Once it is done we will take the next decision."

Although Uber Bangladesh, immediately after its launch in the country, applied for permission to take its earnings directly to its parent company's bank account, the Bangladesh Bank rejected it from the fear that real earnings can be hidden in the proposed way.