Digital Payment Reform: Bangladesh's New Gateway to Global Commerce

It was nearly 11:30 at night. Sitting in her small apartment in Mirpur, Dhaka, Susmita stared at her laptop screen. For the past three years, she has been working as a freelance designer for a software company based in the United States. The project is complete, the client is satisfied, and the invoice has already been sent. Yet it will still take several days before she receives her payment. Between her and her earnings lie multiple intermediaries, currency conversion charges, and a lengthy, complicated payment process.

Every day, hundreds of thousands of young Bangladeshis face the same reality. Their skills meet international standards, but the payment infrastructure available to them has yet to keep pace with the speed and sophistication of the global digital economy.

Having been involved in Bangladesh's e-commerce and digital economy policymaking process for more than a decade, I have repeatedly encountered the same question while working with Bangladesh Bank, various government ministries, banks, fintech companies, entrepreneurs, and the e-Commerce Association of Bangladesh (e-CAB): Why do our entrepreneurs, despite producing world-class products and services, continue to face significant barriers when sending and receiving cross-border payments?

The problem has never been one of talent. It has always been one of financial connectivity.

On July 29, 2026, Bangladesh Bank's Foreign Exchange Policy Department-1 (FEPD-1) issued Circular No. 25, introducing an important—though partial—framework to address this long-standing challenge. In this article, I examine the circular from three perspectives: what it actually introduces, my professional assessment of its significance, and my recommendations for the future.

Why Was This Reform Necessary?

Over the past decade, Bangladesh's digital economy has undergone a remarkable transformation.

International trade is no longer limited to the export of physical goods. Today, software code, design services, SaaS subscriptions, and digital products have become valuable exportable assets. The country's e-commerce sector continues to expand each year, Bangladesh has emerged as one of the world's leading freelance economies, and a growing number of young entrepreneurs are investing in software and Software-as-a-Service (SaaS) businesses.

Unfortunately, the country's payment infrastructure has failed to evolve at the same pace.

Freelancers have long struggled with limited options for receiving international payments and have routinely experienced delays in receiving their earnings. Software exporters have faced complications in collecting subscription revenues from overseas clients. SaaS companies have found recurring payments and global customer billing exceptionally difficult to manage. Likewise, e-commerce businesses have repeatedly encountered obstacles when accepting payments from international customers or integrating with global marketplaces.

What Does the Circular Introduce?

The circular establishes a bank-intermediated cross-border digital payment framework, enabling Authorized Dealer (AD) banks to enter into contractual partnerships with foreign Payment Service Providers (PSPs), digital platforms, Online Payment Gateway Service Providers (OPGSPs), and other legally recognized payment solution providers. Collectively, these entities are referred to in the circular as Cross-border Digital Payment Service Providers (CDPSPs).

At the heart of this framework is the Digital Value Account (DVA).

Simply put, a DVA is a regulated digital wallet—or stored-value account—maintained by a CDPSP in the name of an individual, allowing foreign currency balances to be held digitally. However, it is not an independent wallet. Every DVA must operate as a sub-account under a corresponding bank's master DVA or settlement account. Furthermore, the bank is required to maintain a mirror ledger for every transaction, ensuring complete regulatory oversight and financial transparency.

What does this mean for ordinary users?

A freelancer, for example, will be able to open a DVA through an approved CDPSP linked directly to their bank. While this arrangement promises greater transparency and regulatory compliance, it also means that personal digital wallets will not operate independently. Banking oversight and regulatory control will remain fully intact.

The circular also introduces several additional facilities.

Foreign exchange allocations for travel, medical treatment, or official government visits can now be managed more efficiently through DVAs. Funds from Export Retention Quota (ERQ) accounts and Resident Foreign Currency Deposit (RFCD) accounts may also be loaded into DVAs for eligible use. For export-oriented companies, however, this facility will be restricted to a maximum of three senior executives.

In addition, DVA holders will be permitted to make online payments of up to US$300 per transaction for purposes such as membership fees, information technology expenses, visa application fees, and hotel bookings.

Throughout the entire framework, banks will be required to submit regular reports while strictly complying with Know Your Customer (KYC), Customer Due Diligence (CDD), and Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) regulations.

Have PayPal, Payoneer, or Stripe Been Officially Launched in Bangladesh?

The short answer is no.

This circular does not directly introduce global payment platforms such as PayPal, Payoneer, Stripe, WeChat Pay, or Alipay into Bangladesh. Instead, it establishes a regulatory pathway through which Bangladeshi banks and authorized payment institutions may, in the future, develop partnerships with these global payment networks.

Whether, when, and how these services eventually become available will depend on contractual agreements between banks and CDPSPs, as well as final approval from Bangladesh Bank.

At this point, it is important to distinguish between four different concepts:

A Payment Gateway is the technology that processes online transactions.

A Digital Wallet is a platform that stores funds and facilitates payments.

A Merchant Account enables businesses to accept card-based payments from customers.

An International Payment Network connects banking systems across different countries, allowing cross-border financial transactions.

The DVA framework essentially serves as a regulated bridge between these four layers. It is not, by itself, a complete payment solution.

Practical Impact

For freelancers like Susmita, the reform could make a significant difference.

By opening an approved DVA, they will be able to receive payments from international clients through a more structured and regulated mechanism. However, the actual speed and efficiency of transactions will depend largely on the technical integration achieved between banks and CDPSPs.

Similarly, a woman entrepreneur in Rangpur who exports locally made handicrafts to international markets will benefit from a clearer and more transparent framework for repatriating export earnings.

A SaaS startup in Dhaka may gradually gain access to a banking environment that supports recurring international billing—something that has long been a major challenge for software businesses.

Individuals paying tuition fees abroad or settling medical expenses overseas will also benefit from clearer procedures and well-defined transaction limits for online foreign payments.

It is important to recognize, however, that these advantages have not yet been fully realized.

Banks must first obtain Bangladesh Bank's approval and establish the necessary technological integrations with CDPSPs. In that sense, the circular lays a solid foundation, but meaningful benefits will depend on its effective and timely implementation.

A Balanced Assessment

Through this circular, Bangladesh Bank has taken several important steps in the right direction.

First, it has introduced much-needed regulatory clarity. Freelancers and digital businesses that previously operated within a regulatory grey area will now have an institutional framework governing their international transactions.

Second, Bangladesh Bank has deliberately adopted a controlled and phased approach to reform. Rather than fully liberalizing the system overnight, it has opted for gradual implementation under close regulatory supervision.

Third, routing transactions through the formal banking system should significantly reduce money laundering risks while improving overall financial transparency.

Nevertheless, several important challenges remain.

Many banks still lack the technological capacity required for real-time system integration. The cost of implementation may prove burdensome, particularly for small and medium-sized banks.

Establishing meaningful partnerships with major international payment networks also remains uncertain.

Furthermore, strengthening cybersecurity, ensuring robust data protection, and building consumer confidence will require sustained effort. Merchant adoption rates will likewise be a critical factor in determining the framework's overall success.

The Road Ahead

To ensure the success of this reform, coordinated action across multiple sectors will be essential.

Bangladesh Bank should immediately publish a comprehensive implementation roadmap outlining clear timelines, milestones, and expected outcomes. It should also maintain regular consultations with industry stakeholders to address operational challenges as they arise.

The Ministry of Commerce should take the lead in formulating a comprehensive cross-border e-commerce policy that aligns with the country's broader digital trade ambitions.

The ICT Division should develop a well-defined Digital Export Strategy to accelerate the growth of Bangladesh's technology-driven exports.

The National Board of Revenue (NBR) should simplify and make more predictable the tax treatment of digital export earnings, particularly for freelancers, startups, and small entrepreneurs, thereby encouraging greater participation in the global digital economy.

The banking sector must invest more aggressively in technology to meet the standards required for real-time payment integration and seamless cross-border transactions.

The fintech industry can play a pivotal role by developing reliable technological solutions that bridge banks and Cross-border Digital Payment Service Providers (CDPSPs).

Meanwhile, the e-commerce sector must continue preparing for international markets by strengthening product quality, logistics, regulatory compliance, and customer service standards.

A Historic Opportunity

Bangladesh now stands before a historic opportunity—to emerge as a regional hub for digital trade, digital exports, and cross-border payment services.

FEPD-1 Circular No. 25 represents a significant milestone on that journey.

Its ultimate success, however, will depend not merely on the issuance of regulations but on their effective implementation, institutional transparency, continuous innovation, and close collaboration among Bangladesh Bank, government agencies, commercial banks, fintech companies, and the private sector.

For millions of young Bangladeshis like Susmita, the successful implementation of these reforms could become a turning point.

With sound policymaking, timely execution, and sustained public-private cooperation, Bangladesh has the potential to transform itself over the coming decade—not merely into an exporter of physical goods, but into a globally competitive digital economy powered by digital services, technology, and innovation.

Author: Former Senior Vice President, e-CAB

Note: The opinions expressed in this article are solely those of the author. They do not necessarily reflect the views of Digital Bangla Media. As a matter of editorial policy, opinion pieces are published without substantive editing to encourage the expression of diverse viewpoints. Any offence or disagreement arising from the content remains entirely the responsibility of the readers concerned.