Credit card make use of back again to pre-pandemic levels
Spending through bank cards reached the pre-pandemic amounts in October commensurate with the economic recovery, an indicator that clients will be embracing the plastic funds sidestepping the use of cash.
Total card loans kept by lenders stood at Tk 1,381 crore in October, up 11 % from a month earlier and 17 per cent year-on-year, showed Bangladesh Bank data.
The rise in transactions through bank cards, one of the important purchasing power indicators of clients, hints that monetary activity in the country has been increasingly rebounding, said bank officials directly linked to card businesses.
Spending through bank cards drastically transpired in the second quarter of 2020 because of the strict restrictions in movements imposed simply by the government to keep carefully the deadly flu at bay.
In July, card transactions increased at a faster pace, due to either the easing of lockdowns or erosion of the getting capacity of consumers.
Credit rating cardholders subsequently made an archive quantity of transactions to the tune of Tk 1,552 crore found in August during Eid-ul-Azha, one of the primary festivals for Muslims. The body, however, emerged down sharply in September.
But credit card-holders published the second-highest amount in transactions in October, former August's number and since December 2018.
Mashrur Arefin, managing director of Metropolis Bank, said the lender achieved their usual organization from bank cards in the previous 8 weeks, after a four-to-five-month hiatus as a result of economic slowdown due to the coronavirus pandemic.
City Bank may be the top player in the country's credit card market. It has released around 5 lakh cards.
"We have almost gained the entire income from the business enterprise of credit card on recent periods. The domestic industry has wholly switched around," Arefin said.
But the loan company has yet to enjoy its business from the associated foreign part due to travel limitations imposed by various nations since the beginning of the pandemic.
"The cross-border transactions have almost arrive to a halt. We will be but to manage our desired earnings from that portion," Arefin said.
Mahiul Islam, brain of retail banking at Brac Lender, echoed the same.
Brac Bank, among the largest card-issuers in Bangladesh's banking sector, can be enjoying an upward trend found in transactions through the digital tool.
"The bank offers a rest from the slowdown in the credit rating card business as transactions through the device have been increasing in recent periods," he said.
"Our credit card organization has reached the pre-pandemic levels," he said.
Clients now prefer bank cards when compared to the pre-Covid-19 period because they are reluctant to go to shops in person to be able to avoid catching the deadly flu, said Ahsan Ullah Chowdhury, the brain of the card and digital banking at Eastern Bank Ltd.
A good good number of individuals have grown to be habituated to using bank cards, giving a improve to the number of transactions as well, he said.
The number of transactions totaled 23.54 lakh in October in contrast to 21.19 lakh in September. The pandemic has got given a great press to e-commerce, which includes as well had a positive effect on the card business, Chowdhury said.
He, however, said a good number of people who lost their jobs due to the business meltdown have generally depended on bank cards, playing a positive role found in expanding the consumption of the digital tool.
The issuance of bank cards was on the upsurge in October when the outstanding number of banks' bank cards stood at 16.31 lakh whereas it was 16.19 lakh a month ago.
Folks have recently started using domestic airlines and traveling heavily, expanding the credit card business altogether, said Syed Mohammad Kamal, MasterCard's country manager.
"We should promote bank cards in order to push digital obligations. Both government and the central lender should take policy actions to this end," he said.
The Bangladesh Association of Application and Information Products and services requested the central bank and the finance and ICT ministries in September and October respectively to supply 3 % subsidy to clients and 2 % to merchants on the utilization of cards.
"If the federal government accepts the present, the country's digital payments will widen tremendously," Kamal said.
The subsidy should continue for a particular period such that persons become habituated to the plastic money, he said.
