TakaPay card marks major leap towards Smart Bangladesh, says Hasina

The payment card will operate through the Bangladesh Bank's National Payment Switch Bangladesh (NPSB), making it compatible with any ATM booth

Prime Minister Sheikh Hasina has heralded the launch of TakaPay, Bangladesh's national debit card, as a significant step towards building a smart and cashless society.

"For far too long, we've relied on international card networks for local payments, resulting in a substantial outflow of money. But that era has come to an end as all TakaPay card transactions will now be facilitated through the Bangladesh Bank's National Switch," she said, while inaugurating the card via video link on Wednesday.

"Today marks a momentous day for us. We set out to establish a digital Bangladesh back in 2008, and now we've successfully achieved that goal. Our vision for the future is to create a Smart Bangladesh."

TakaPay is essentially a debit card, allowing customers to conduct transactions similar to traditional Visa or MasterCard options. Multiple banks across Bangladesh will have the authority to issue the card, with regulatory control vested in the central bank.

The government has highlighted the added benefit of reduced dependence on international cards, resulting in foreign currency savings.

Outlining the government's goal of elevating Bangladesh to the status of a developed nation, Hasina said, "The steps we are taking align with our vision for a Smart Bangladesh. Our citizens will become smarter, our economy will grow smarter, and we will develop a smart government system. Our society will transform into a smart one."

The premier also highlighted the initiative to foster a cashless society, citing the formulation of the Bangladesh Mobile Financial Services Policy. Emphasising the nation's sovereignty, she said, "We are an independent, sovereign country, and we've been able to establish an independent sovereign economic system."

Currently, all payment cards used in the country are produced by foreign companies. Banks offer these card services for a fee, with foreign-owned card providers receiving a share of these fees. Additionally, there are extra charges when using a card at another bank's ATM.

However, the TakaPay card operates through the Bangladesh Bank's National Payment Switch Bangladesh, making it compatible with any ATM booth and ensuring seamless and swift transactions.

Bangladesh Bank is now moving towards introducing debit, credit, and eventually international cards. Additionally, there are plans to enable the use of dual currencies, including the Indian rupee, with the TakaPay card starting in December.

This will allow Bangladeshis to use the TakaPay card for rupee transactions when travelling to India, eliminating the need to carry foreign currency. Bangladeshi nationals spend the highest amount of foreign currency in India.

Several countries have introduced similar card systems before. India has RupeeCard, Sri Lanka has LankaPay, Pakistan PakPay, and Saudi Arabia uses Mada-Card, its local card.

Debit cards are connected to the user’s bank account and allow direct payment from that account. Credit cards, on the other hand, allow the user to take out a loan that they can pay back later. If the user pays within 40-45 days, they don’t need to pay interest on credit card loans. However, banks charge interest if that deadline is exceeded.

People across the world have started using cards more frequently as they are more secure and easier to carry.

Bangladesh has as many as 43 banks that issue debit and credit cards. The number of cards active in the country is approximately 32.7 million.