Credit card transactions in Bangladesh reached a record Tk29,962 crore in FY23, denoting a 17 per cent increase compared to FY22, show Bangladesh Bank data.
Such cards have eased shopping and other digital transactions for city dwellers. So its use is increasing day by day, and the volume of transactions is also jumping in digital platforms.
An analysis of central bank data shows that the average monthly credit card transactions stood at Tk 2,496 crore in FY23. It should be noted that though the amount of transactions rose in last FY, the growth was lowest in four fiscal years
Credit card transaction growth was lowest in FY23 even compared to the Covid-19 outbreak of FY20 and FY21. Card usages surged during the pandemic crisis as in-person shopping and travel were restricted.
Transactions rose by 42.06 per cent to Tk17,972 crore in FY21 compared to FY20. This figure was Tk25,624 crore in FY22, a growth of 42.58 per cent. But in the last financial year, credit card transaction growth dropped to 16.93 per cent.
Industry insiders say the transaction growth declined mainly due to the high inflation, as people reduced their usage of credit cards. Moreover, the USD shortage caused restrictions in overseas travels, which cut credit card usages.
Even though Eid-ul-Azha was celebrated in June, credit card transactions decreased slightly compared to May this year. The transaction amount was Tk2,592 crore in May, which declined to Tk 2,583 crore in June.
The central bank shows that the number of credit card transactions is on the decline since May this year. The number of transactions dropped 42.77 lakh in April, to 40.55 lakh in May, and 39.05 lakh in June this year.
Speaking to The Business Post, Mastercard Country Manager Syed Mohammad Kamal said, “A shopping boom usually occurs during Eid festivals, but that was not the case in the last two years.
“People have reined in their spending habits gradually. There is an inflationary pressure in the country. Besides, many who opted for digital transactions later returned to using cash after the Covid-19 crisis eased.”
He added that as tax returns are now mandatory for availing credit cards, it has made a big impact on card issuances.
Bangladesh is under the pressure of high inflation due to the USD crisis that has persisted since the last FY. The inflation in May this year was 9.94 per cent – the highest in the last 11 years.
Inflation eased slightly to 9.74 per cent in June and 9.69 per cent in July.
