Banking transactions in the country have rebounded after a sharp fall for nearly three months to May, as people have gone back to normal life despite the high infection rates of Covid-19.
The transactions include checks, credit cards, debit cards, prepaid cards and internet banking. The transactions started declining from late March due to the pandemic before picking up in May as business and economic activities continue to accelerate, defying risks posed by the novel virus.
According to Bangladesh Bank (BB) data, interbank transactions through cheques increased by 82.63% to Tk2,02,646.6 crore in June, debit card transactions increased by 6.21% to Tk12, 528.1 crore, credit card transactions increased by 25.78% to Tk898.0 crore, prepaid card transactions increased by 4.23% to Tk140.3 crore and internet banking transactions increased by 34.15% to Tk7421.1 crore in June compared to the previous month.
The government imposed a countrywide shutdown from March 26 to May 30 this year after the detection of the first coronavirus-infection in the country on March 8. All economic activities of the country were suspended during the shutdown. After May, people began a return to normal life despite a high infection rate of the rampaging virus.
Banking transactions became a normal trend in June with people returning to normal life with the end of the lockdown on May 30, although the high infection rate of COVID-19 still battered lives and the economy, said a high official of the BB.
Talking to Dhaka Tribune, the former chairman of the Association of Bankers, Bangladesh (ABB), Syed Mahbubur Rahman said that banking transactions had declined disproportionately during April and May owing to the pandemic.
“The impact of COVID-19 on the country's trade and commerce are understood from the picture of banking transactions. However, banking transactions have rebounded after May as people have gone back to normal life,” said Syed Mahbubur Rahman, who is also the Managing Director of Mutual Trust Bank.
All forms of banking transactions had returned to normal except for import and export, he stated.
Interbank transactions through cheques
All developed countries have already transformed to digital transactions from traditional cheque-based transactions. However, the lion’s share of banking transactions is still carried out through cheques in Bangladesh. Interbank transactions through cheques declined by 50.32% to Tk93848.1 crore in April compared to the previous month due to COVID-19, before returning to a normal trend in May and June.
Transactions through cheques constantly increased by 18.23% and 82.63% in May and June, as per the BB data.
Debit cards transactions
Debit card transactions declined by 44.93% to Tk 8,335.70 crore in April, but then increased by 41.49% and 6.21% in May and June.
Credit card transactions
Credit cards have become popular payment instruments among diverse groups of people. No fewer than 35 banks are now operating the credit card business. They had 15 lakh 56 thousand 448 credit cards till January this year.
Credit card transactions increased to Tk898.0 crore in June, up by 25.78% from the previous month, according to the BB data.
Prepaid card transactions
Prepaid cards are rapidly gaining traction in the country. Clients of prepaid cards stood at 5 lakh 86 thousand 230 till June. Prepaid cards transactions increased by 4.23% to Tk140.3 crore in June than in the previous month.
Internet banking transactions
Clients of internet banking stood at 27 lakh 42 thousand 241. Internet banking transactions declined by 29.19% in April, then it increased by 18.59% and 34.15% in May and July.
As people went back to normal life and the economy opened up after the countrywide lockdown, the BB on August 18 asked all scheduled banks to restore normal banking activities, scrapping roster-based weekly–duty schedules for employees.
The central bank also instructed the banks to restore evening banking along with the regular banking activities. Banks were asked to conduct banking activities on the weekends in the usual manner.
