Rate of cash usage expected to reduce by 75% in next 4 years: Kamal

The rate of cash usage is expected to reduce by 75% in the next four years, said Finance Minister AHM Mustafa Kamal today.

"By introducing universal Bangla QR, steps have been taken to bring all merchants including small and marginal traders under digital payment to create 'Cashless Bangladesh'. As a result, the rate of cash usage is expected to reduce by 75% in the next four years," the minister said while presenting the national budget on Thursday (1 June).

He added that a number of steps to reduce cash-out charges and increase transaction limits in the development of the MFS system, payment of workers' wages in the ready-made garment industry, use of MFS accounts in microcredit programmes including social security programme allowances under the G2P system, and expansion of sub-branch and agent banking system have strengthened the inclusive banking system.

Timely adjustments in monetary policy are being made to maintain macroeconomic balances and achieve higher growth, he stated.

"In order to ensure necessary liquidity in the money market during the Covid-19 crisis, the repo rate was reduced by 100 basis points to 4.75% from 5.75% in two steps and the reverse repo rate was reduced by 75 basis points to 4.00% from 4.75%. Later, repo rate has been increased by 125 basis points from 4.75% to present 6.00% and reverse repo rate has been revised by 25 basis points to 4.25% to mitigate the 27 increasing pressure of demand-driven inflation," Mustafa Kamal added.

The finance minister said the move is contributing to macroeconomic stability, 

"Besides, various steps have been taken to increase credit flow to the productive sector and ensure ease of transactions which is helping to achieve higher growth. Investment flow in agriculture and other productive sectors including SMEs has been uninterrupted as banks and other financial institutions have fixed the ceiling on loan interest rates and implemented various incentive packages," he further added. 

With a focus on inflation, job creation, fourth industrial revolution and "Smart Bangladesh", Finance Minister AHM Mustafa Kamal on Thursday (1 June) placed before the Jatiya Sangsad a Tk7.61 lakh crore National Budget for the Fiscal Year 2023-24.

This will be the largest budget for Bangladesh, a long way from the first budget of Tk786 crore budget placed by Tajuddin Ahmed for the FY1972-23.

The latest budget is 12.34% bigger than the last one, which was originally proposed to be Tk6,78,064 crore. This was the last budget of the present Awami League government's five-year term.

Finance Minister AHM Mustafa Kamal delivered his budget speech with the title "Unnayner Derdoshok: Smart Bangladesher Abhimukhe."

The budget was prepared with an emphasis on ensuring people's employment through business expansion.