Digital payments grow but lose market share in 2024: BB

Business Report :

While digital transactions including payments made through mobile wallets, internet banking, and other electronic channels continued to grow in Bangladesh in 2024, their overall share of total payments declined, according to the Bangladesh Payment Systems Report 2024 released by Bangladesh Bank on this week.

The report shows that traditional, non-digital payments are now expanding more rapidly than digital channels, while mobile financial services (MFS) have recorded a notable drop in activity.

Bangladesh Bank data reveal that the number of digital transactions increased from 36.67 crore in December 2023 to 40.31 crore in December 2024. However, despite this rise, digital payments accounted for a smaller share of total transactions, slipping from 51 percent to 47 percent.

In terms of value, the total amount moved through digital channels grew slightly from Tk 75,140 crore to Tk 76,340 crore but their share of overall transaction value declined from 29 percent to 28 percent.

A key factor behind this shift is changing user behaviour within the MFS sector, one of the pillars of Bangladesh’s digital finance ecosystem.

The central bank report notes a sharp fall in the share of MFS-based digital transactions. Volume share dropped from 46.82 percent to 40.99 percent, while value share inched down from 2.37 percent to 2.36 percent.

According to the BB report, this trend reflects a “growing shift toward cash-based behaviour within the MFS ecosystem,” with users increasingly choosing cash-out options instead of completing transactions digitally.

In contrast, non-digital payments surged significantly in both number and value. Transaction volume rose by 31.4 percent, from 34.62 crore in December 2023 to 45.49 crore in December 2024, while their share of total transaction value increased from 71 percent to 72 percent.
The data suggest that although digital platforms dominate small and frequent payments, large-value transactions continue to rely heavily on cash, cheques, and over-the-counter payment methods.
Despite these shifts, several digital channels recorded strong performance throughout 2024. Internet Banking Fund Transfer (IBFT) remained the leading mode under the National Payment Switch Bangladesh (NPSB), accounting for 80 percent of the system’s total transaction value, the BB report states.
The publication also highlights key regulatory achievements in 2024, including the enactment of the Payment and Settlement System Act, 2024, which strengthens the legal framework for the country’s payment infrastructure, and the launch of TakaPay, Bangladesh’s first domestic card scheme.
The report emphasises that strategic steps will be required to counter the renewed reliance on traditional payments and rising cash dependency. Encouraging large-value institutional and government transactions to shift to digital platforms, it notes, will be essential for Bangladesh to progress toward a less-cash economy.
Meanwhile, the Bangla QR system now widely used in universities, hospitals, retail establishments, and digital cattle markets saw rapid expansion, with transaction volume increasing by 104 percent and transaction value by 69 percent in 2024.
Overall, Bangladesh’s payment landscape in 2024 experienced significant regulatory, infrastructural, and supervisory developments, all aimed at building a more secure, efficient, and inclusive digital financial environment.