Government wants to expand digital banking services and plans to launch digital currency

The government is optimistic about the expansion of digital banking in the country to accelerate financial inclusion with the aim of creating more jobs for young job seekers.

According to an official document seen by UNB, the government has stepped in to look into the possibility of establishing digital banks.

He says if digital banking, which involves high levels of process automation and web services, could be scaled up, new jobs would be created for information technology graduates. Digital banking provides services primarily through non-physical means such as application-based systems and without printed documents, filling out forms or conducting transactions through e-wallets.

The government is also considering whether Bangladesh Bank can introduce digital currency. The introduction of central bank digital currency (CDBC) will facilitate currency in virtual transactions and encourage startups and e-commerce businesses, the document says.

It should be noted that the creation of digital banks is under initial or experimental implementation in various developed countries and some developing countries in Asia, including Singapore, Malaysia and India.

It also says that the introduction of services like mobile financial services (MFS) and banking agents in the country has facilitated financial inclusion.

But, he says, due to the lack of transaction interoperability between MFS service providers, users of the service have not had the ability to make direct inter-transactions.

“To make financial inclusion more dynamic, the government has introduced financial interoperability in the country and fixed nominal fees and charges for inter-transactions,” the report says.

The government has also formulated the National Financial Inclusion Strategy of Bangladesh (NFIS-B) to establish social cohesion and economic stability by ensuring access to quality financial services for people from all walks of life.

Its main objective is to provide a comprehensive framework through which cooperation can be strengthened by coordinating and prioritizing the work of all stakeholders involved in financial inclusion activities.

The NFIS National Council (NNC) was formed to implement various programs under the said strategy.

“All these steps will further strengthen the foundations of the financial inclusion process in Bangladesh,” he says.

As the risky use of virtual currencies such as cryptocurrencies continues to grow around the world, many central banks around the world are making efforts to launch digital versions of their currencies as an alternative to cryptocurrencies.

The main purpose of launching Central Bank Digital Currency (CDBC) is to facilitate currency in virtual transactions and encourage startups and e-commerce businesses.

As a result of the timely measures of the current government, the coverage of internet and e-commerce in the country has increased significantly.

In this context, Bangladesh Bank will conduct a feasibility study on the possibility of introducing digital currency in Bangladesh.

The Bangladesh Systemic Risk Dashboard is being developed to identify systemic risks and present Bangladesh Bank’s assessment to stakeholders on a semi-annual basis.

The financial projection model is implemented to identify potential risks and weaknesses in the financial system.

In addition, an interbank transaction matrix is ​​set up to determine the nature, risk and contagion effect of interbank transactions.

Bangladesh Bank has formulated a recovery plan to prepare banks to automatically and effectively adapt to the severe crisis situation in advance.

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