Bangladesh stands at a historic turning point in its financial evolution. The Bangladesh Bank’s directive enabling full interoperability across banks, Mobile Financial Services (MFS), and Payment Service Providers (PSPs) represents not just regulatory reform—it marks the foundation of a unified digital economy.
Set to launch on November 1, 2025, this interoperability framework will enable real-time fund movement between all platforms, breaking down the barriers that have long separated banks and mobile wallets. For 170 million citizens, this means faster, cheaper, and more inclusive access to financial services.
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Interoperable Transactions Go Live: Bangladesh Bank Circular
On October 13, 2025, Bangladesh Bank issued PSD Circular No. 12, announcing that starting November 1, 2025, the National Payment Switch Bangladesh (NPSB) will enable interoperable transactions across banks, Mobile Financial Services (MFS), and Payment Service Providers (PSPs). The goal: make fund transfers seamless, reduce costs, and unify fragmented digital payment systems.
What Is Interoperability?
Under the new system:
- Banks, MFSs, and PSPs will be connected via NPSB, forming a unified network to move funds instantly among them.
- MFS (Mobile Financial Services) refers to digital wallet systems with agent networks (e.g. bKash, Nagad).
- PSP (Payment Service Provider) is similar but without agent points (e.g. Pothao Pay).
- The model requires the sender to bear the transaction fee, not the recipient. The fee is transparently shown before sending.
New Fee Structure & What Changes
All transactions will be routed through the NPSB platform to ensure speed, security, and uniformity.
The circular capped transaction fees, including VAT, at 0.15% for banks, 0.20% for PSPs, and 0.85% for MFS providers.
Service providers must display the applicable charge before processing, and only senders may be charged, receivers cannot be.
Notably, intra-bank transfers will still cap at Tk 10 per transaction, as before.
Will “Add Money” Get More Expensive?
Many users worry that the cost of add-money (i.e. loading wallets from banks) will rise. Under the new regime:
- If the wallet top-up uses NPSB, banks may charge Tk 1.5 per 1,000 (0.15%) as the maximum.
- However, MFS providers may absorb or rebate that fee (e.g. via bonuses) to maintain “free” top-ups.
- Importantly: using non-NPSB routes (existing bilateral APIs or international rails) remains possible, giving providers flexibility.
Because each institution has different costs (agent commissions, infrastructure, etc.), Bangladesh Bank opted for “maximum fee” limits rather than fixed pricing, encouraging healthy competition and service quality.
Where Some Transactions Get Cheaper
One favorable change: MFS wallet → bank account transfers will see reduced costs. Under the previous rules, these could cost Tk 10.5 to 12.5 per thousand. The interoperable cap lowers this to Tk 8.5 per thousand.
This benefits freelancers, online merchants, and users who frequently cash out from wallets to banks.
Breaking Down Invisible Barriers
Previously, digital transactions across institutions required direct bilateral arrangements (only between entities having integration). This fragmented system excluded many smaller players and limited flexibility.
With NPSB-based interoperability, all participating banks, MFSs, and PSPs join the same network—removing “walls” and expanding reach.
PSPs in particular stand to gain, as they often lacked access to broad acceptance before. Now, they can fully integrate into national payment flows.
Why Bangladesh Bank Chose a “Maximum Fee” Approach
Rather than fix one price for all, Bangladesh Bank has set upper bounds to provide flexibility:
- Institutions can set lower fees if their cost structure allows
- They can strategically subsidize certain flows or rebate fees
- It preserves competitive differentiation while ensuring user protection
Also, Bangladesh Bank and NPSB do not take any revenue or fees from these transactions—the aim is to encourage adoption, not profit from it.
What It Means for You (the User)
- Greater freedom: You can send money from your bank account or wallet to nearly any financial provider seamlessly.
- Transparent costs: Fees will be visible before you confirm transactions—no hidden charges.
- Cheaper cash-outs: Wallet → bank transfers may now cost less than before, benefiting many users who move money between these systems.
- One platform convenience: Managing money across different providers becomes easier, without juggling multiple apps or interfaces.
The Cost of Cash: An Unseen Economic Drain
Despite significant digital progress, cash remains king in Bangladesh. As of December 2024, 71.72% of all transactions were cash-based, amounting to Tk 19.58 lakh crore.
This reliance on cash carries a staggering price tag:
- Tk 20,000 crore is spent annually on cash management—printing, security, and distribution.
- Tax revenue losses from the informal cash economy range between Tk 55,800 crore and Tk 2,92,500 crore, with credible estimates near Tk 2,23,000 crore.
These figures represent more than inefficiency—they are resources that could have funded new schools, hospitals, and infrastructure. Interoperability, therefore, isn’t just a technical upgrade; it’s an economic imperative.
From Fragmentation to Flow
Until now, Bangladesh’s digital payment landscape has been fragmented.
MFS giants like bKash, Nagad, and Rocket expanded rapidly but operated as closed systems. Banks developed their own apps and digital solutions, yet none could seamlessly communicate with one another.
The new interoperability framework changes this. Built on the National Payment Switch Bangladesh (NPSB), it enables:
✅ Instant transfers between bank accounts and MFS wallets
✅ Cross-MFS fund transfers (e.g., bKash to Nagad)
✅ Transparent pricing for all digital transfers
This means that a garment worker in Dhaka can now transfer money directly from her bank to her mother’s wallet in Khulna within seconds—no agents, no delays, no friction. Multiply this efficiency across millions of transactions, and the impact becomes transformative.
Why Interoperability Matters
1. Efficiency and Cost Savings
Physical cash is expensive. Every note printed and transported drains public funds. Digital rails dramatically reduce these costs, freeing capital for productive investment.
2. Transparency and Accountability
Digital transactions leave audit trails, reducing opportunities for tax evasion, corruption, and theft. For small businesses, this creates a documented financial footprint—key for accessing credit and formal financial services.
3. Financial Inclusion
Interoperability ensures that everyone—from rural traders to urban professionals—can participate in the same digital economy. It brings the unbanked into the financial mainstream without forcing them to switch platforms.
The Fintech Revolution: From Products to Platforms
For fintechs and digital banks, interoperability is oxygen for innovation. It transforms isolated payment products into connected financial ecosystems.
- Merchant Empowerment: A small shop in Chittagong can now accept payments from any bank or wallet, reducing cash dependence and boosting digital transactions.
- Remittance Efficiency: With Bangladesh receiving over $27 billion in remittances in 2024, interoperability ensures money reaches families faster and at lower cost.
- Credit Access: Unified data across systems enables alternative credit scoring, empowering small entrepreneurs and informal workers to access formal loans.
This evolution marks the shift from “financial access” to financial empowerment.
The Pillars of Interoperability: Key Enablers
1. Bangla QR: Universal Digital Acceptance
Bangla QR is revolutionizing merchant payments by providing a single QR code usable by all banks and MFS apps.
For micro-merchants, it means no more juggling multiple payment providers—just one code to accept payments from anyone.
This is the most practical way to move Bangladesh toward a cashless economy, particularly among small traders and SMEs.
2. White Label Agent Networks (WLANs): Expanding Reach
Bangladesh has over 1.4 million MFS agents, but most operate in cities. WLANs allow any agent to serve customers of any bank or wallet, offering cash-in/cash-out services universally.
This model enhances rural financial inclusion, improves agent profitability, and reduces duplication of infrastructure.
3. Payment Initiation Services (PIS): Opening the Banking System
PIS marks Bangladesh’s entry into open banking. It allows licensed third parties to initiate secure payments from a user’s account—without sharing credentials.
This innovation enables seamless “Pay from Bank” options on e-commerce platforms and drastically reduces checkout friction and transaction fees.
It also opens doors to embedded finance, such as instant crop loans for farmers or installment payments for healthcare and education.
Implementation Challenges Ahead
Bangladesh’s success will depend not on technology alone, but on institutional readiness.
- System Resilience: NPSB must handle peak transaction volumes reliably.
- Cybersecurity: With integration comes vulnerability; real-time fraud monitoring is critical.
- Consumer Protection: Clear dispute resolution mechanisms are essential when transactions span multiple institutions.
- Data Governance: Bangladesh must build robust privacy frameworks that balance innovation with user protection.
Learning from Global Models
Bangladesh can draw valuable lessons from India’s UPI and Kenya’s M-Pesa:
- UPI thrives on open APIs, zero-cost transfers, and wide merchant adoption.
- M-Pesa shows the importance of dense agent networks and later evolution toward interoperability.
Bangladesh’s hybrid approach—combining rural physical touchpoints with urban digital integration—positions it for inclusive digital transformation.
The Road Ahead: Execution Will Define Success
The November 1, 2025 launch marks a beginning, not an end. True success will depend on:
- Banks, MFSs, and PSPs integrating systems seamlessly.
- Fintechs building value-added services atop interoperable rails.
- Merchants and consumers gaining confidence through reliability and ease of use.
The Bangladesh Bank’s regulatory balance—encouraging innovation while maintaining security—will determine the pace and stability of this transformation.
Conclusion: From Payments to Prosperity
Interoperability redefines how Bangladesh moves, manages, and measures money. It transforms the payment question from “How do we send money?” to “How do we build prosperity through digital finance?”
If executed with vision and discipline, this reform could convert Tk 20,000 crore in cash handling costs and Tk 2,23,000 crore in lost tax revenue into productive capital. It will turn financial access into financial empowerment—linking every citizen, business, and institution into a shared digital future.
As Bangladesh tears down the walls between banks and mobile wallets, the nation steps closer to an economy that is inclusive, efficient, transparent, and digital-first.
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