Dhaka’s Hidden Trillion Taka Economy: Why Digitizing Street Commerce Is Now Urgent

Every morning on my way to Motijheel, I pass through a marketplace Bangladesh has never formally acknowledged.

It stretches across footpaths, bus stands, and alleyways—a vast network of street vendors, fruit sellers, tea carts, and countless micro-entrepreneurs sustaining Dhaka's shadow economy. They represent more than 59 million Bangladeshis—nearly 84 per cent of our workforce—who survive in the informal economy, entirely outside the formal financial system.

Most people walk past without thinking beyond a quick purchase. But I see inefficiencies we have normalised, opportunity costs we never calculate, and revenue leakages quietly draining the state. What I see is a massive parallel economy that is productive but undocumented, vital but financially invisible.

Dhaka alone shelters nearly three lakh street vendors. With close to two crore residents living and working in this urban engine, the informal sector has become the city's largest employer. The real question is why we allow such a workforce, contributing almost half of Bangladesh's GDP, to operate outside our expanding digital financial ecosystem. Bangladesh has become a global leader in digital transactions, yet the first mile of our economy still runs on cash.

Mobile Financial Services handled Tk 17.37 lakh crore in transactions in 2024—almost half of our GDP. We now have 23.86 crore MFS accounts. Digital banks are launching, and QR payments are spreading across cities. Nearly 84 per cent of banking transactions are digital. Yet the people powering daily commerce at street level still operate in a cash-only world.

A visit to Motijheel, Gulistan, or Mirpur reveals an economy that works smoothly for those who exploit it, not those who participate in it. Thousands of vendors earn their living on public roads without licences or tax registration. Yet they pay something informal everyone knows about. A political coordinator, local muscleman, or mastan collects a daily placement fee. These collectors make pure profit while City Corporations receive nothing. They monetise public land without accountability. This system survives because it is cash-based, undocumented, and invisible to policymakers. It is perhaps the most organised unorganised business model in the country.

A blueprint for change already exists. Consider street parking. A man in a yellow vest collects cash and hands you a receipt claiming it goes to the City Corporation. But how much reaches the official system? DNCC's Smart Parking app, launched in November 2023, shows what digital transparency can achieve. Users can find spaces, book slots, and pay digitally. The system is traceable, transparent, and resistant to leakage. If digital solutions work for parking, they can work for street vending.

The solution is straightforward. A vendor who has operated in the same spot for years is not temporary. This person is a micro-entrepreneur contributing to urban life and deserves recognition. City Corporations can issue digital licences through a simple mobile app. Vendors mark their location, submit basic ID, and receive QR-based permission to operate. All payments happen digitally. No cash, no middlemen, no informal collectors.

If each vendor paid even a small digital fee, City Corporations would gain a transparent revenue stream immediately. This income could fund organised vending zones, maintain footpaths, and improve waste management. Government agencies would gain tax visibility. Banks would access a customer segment never before part of the formal system. Most importantly, vendors would gain a digital footprint. With that data, financial institutions could design microcredit, insurance, and savings products tailored to real earning patterns. Those invisible today become viable, bankable customers tomorrow.

Some may argue this requires committees, approvals, and long processes. Yet the current informal system required none of that. It created itself without permission and runs without rules. If an unregulated, opaque system can thrive on public land without government support, then a transparent, digitised system can be built with it.

Bangladesh spends nearly Tk 20,000 crore yearly just handling cash. The country loses an estimated Tk 2,23,000 crore annually in tax revenue due to cash-based informality. Even after major improvements in digital finance, 71.7 per cent of transactions in December 2024 were still cash-based. This contradiction is unsustainable if Bangladesh wants orderly urban development and if millions of micro-entrepreneurs want dignity and stability.

Digitising street vending benefits everyone. The government gains revenue. City Corporations gain financial strength. Banks reach new markets. Vendors gain legitimacy, protection, and access to credit. Citizens get safer, more organised streets. Most importantly, informal fees lose their influence because digital systems do not negotiate with mastans.

The man selling chotpoti outside a bank and the woman selling fruits near a bus stand have been part of Dhaka's identity for generations. They are not the problem. The problem is that we never built a framework to bring them into the formal economy. A digital framework is not a threat. It is an upgrade to their future.

Bangladesh already has the technology and infrastructure. What we need now is the political will to extend these systems to those who need them most. When we digitise the streets, we do not just build a smarter city. We build a fairer Bangladesh.