Bangladesh advances digital economy through ID and payment initiatives

Bangladesh is working to establish the infrastructure for a digital economy through unified identity systems and standardized payment methods. Under the D-STAR program supported by the World Bank, the government is developing a “One Citizen, One Digital ID, One Digital Wallet” initiative. This platform aims to provide lifelong digital identities linked to smartphone wallets for accessing public and private services, operating under consent-based data sharing policies.

In the financial sector, Bangladesh Bank has implemented the Nexus Smart ID platform to issue certificate-based identities for people, devices, and services. This move is intended to strengthen authentication and information security across digital banking services using a corporate public key infrastructure (PKI).

However, the adoption of the “Bangla QR” service, designed to facilitate a cashless society, has faced challenges. Despite a Tk1 billion fund to reduce costs for merchants and directives for all banks and mobile financial service providers to use the standardized code, daily transaction volumes remain below Tk1 billion. Industry insiders suggest that small business owners are reluctant to adopt digital payments due to fears regarding the tax system, specifically the imposition of minimum turnover taxes based on total sales rather than income.