Fire, water, open space, and air are mankind's original commons.
While air remains the most free-flowing of them all, it still requires money under certain conditions, and the breath in our lungs carries a cost in today's post-industrial era.
Let us draw a parallel to the Bangladesh Bank's recent decision to slash down to zero the interchange reimbursement fee or IRF, which is the vital earning source of the participating institutions that provide mobile financial services (MFS).
Not just this monetary transaction facility, but also any utilities free of costs -- be it telecommunications and banking services or use of electricity -- could have been considered the most loved thing to modern people, had there been no charges!
The central bank has made the policy shift by cutting IRF to be zero and MDR can be set at zero with the lifting of 1% floor price effective from October 1, 2026.
This directive for 'Bangla QR' system has been issued to further popularize digital payments.
It allows customers to make direct payments simply by scanning a merchant's QR (Quick Response) code using their bank or MFS apps, a revolutionary step towards attaining transparency in daily commerce and a cashless society.
In Bangladesh, we expect that the government provides energy subsidy without actually targeting the vulnerable groups who need and deserve it.
As a result, such policy turns unsustainable, and the people have to pay multiple prices to get access to energy. Also, the farmers have been incurring losses over the years as a consequence of a populist policy of, say, for example, keeping rice price low.
Now, the question arises: would a zero IRF and MDR not expose the entire digital payment ecosystem to severe structural risks as the measure removes an 'organic revenue model that funds network infrastructure, security upgrades and fraud prevention'?
None can deny that zero fees are consumer-friendly, only on paper, however. Industry innovators apprehend that this decision would jeopardize the institutions that have invested in building the digital payment infrastructure.
Many others may either ignore or be unaware of the fact that behind every seamless QR transaction lies a complex web of expenses: technology maintenance, agent incentives, distribution networks, mobile network operator charges, customer service, and settlement costs.
This means removing the IRF and MDR strips the platforms of their capacity to recover these essential operating costs.
Similar digital payment was 'free' in India where the government has borne the costs by giving subsidies, but that subsidy, too, is going to be withdrawn anytime.
Given the current fiscal constraints, it is not advisable either that the government of Bangladesh subsidize the costs of going cashless.
At the same time, making zero IRF and MDR to pave the way for popularizing Bangla QR is tantamount to punishing MFS operators who have made investments and driven the vast majority of digital financial transactions.
The process of converting hard cash into digital balance (cash-in) and vice versa (cash-out) relies on a massive network of human agents and distributors, according to the business model.
Managing this expansive infrastructure is financed through a delicate balance of transaction fees, service commissions, and merchant discount rates or MDR.
The government would lose revenues in the form of value-added tax (VAT) for every transaction under this model.
The MFS provider's subsidy for a single Tk1,000 cash-in transaction could stand at Tk6.40.
This begs another question: If the financial spine of the existing digital infrastructure is weakened in the name of incentivizing cashless transactions, who will foot the bill in the long run?
Cuts in fees for agents under the circumstances may work as a disincentive for this army of people, numbering around 2.4 million to remain engaged in MFS.
This human network has democratized financial services, reaching the under-banked and unbanked masses even in remote places.
If the agent-driven ecosystem is dismantled to force a new digital payment model prematurely, years of hard-earned progress in financial inclusion may be reversed.
In zero IRF and MDR regime, some desperate merchants and/or agents may find incentive to make fake payments and still take certain commissions bypassing the system. Transactions of ill-gotten money or money laundering through fake payments cannot be ruled out.
Already allegations have it that some agents and merchants are exploiting Bangla QR codes to facilitate informal cash-out services for customers without any actual exchange of goods or services.
On paper, these look like progressive digital payments, but in reality, they are merely disguised cash withdrawals.
Such practice would artificially inflate official digital transaction data; it distorts the true picture of digital commerce in the country. Industry experts warn that a zero-IRF and MDR policy will likely amplify this malpractice.
An unintended consequence of this policy is likely to be the squeezing of MFS providers, who may eventually be forced to impose new charges on basic cash-in services.
This would create a lose-lose scenario: the government's revenues contract, while the transaction costs for ordinary citizens rise.
Since Bangla QR is deeply intertwined with the broader digital payment grid, a one-sided measure of introducing zero fees may be counterproductive.
Thus, the central bank may think of devising a balanced tariff structure through discussions with the stakeholders.
If QR codes become a tool to bypass standard cash-out channels without driving real retail commerce, it is feared that Bangla QR will end up deviating from its core objective of fostering a genuine cashless economy.
Salahuddin Bablu is a journalist
