The volume of foreign currency transactions made through cards declined in November compared with that in the previous month.
Bangladesh Bank data showed that the amount of card-based foreign currency transactions decreased to Tk 672.34 crore in November 2024 from Tk 727 crore in October 2024.
Bankers noted that while the volume of foreign currency transactions did not increase significantly, the prices in local currency showed an uptick due to the devaluation of the local currency.
They said that the foreign exchange transactions by cards depended on availability of dollars and the number of travellers going abroad.
The dollar amounts held by Bangladesh鈥檚 commercial banks dropped to a five-year and six-month low in December 2024, reflecting the severe impact of Bangladesh Bank鈥檚 mismanagement amid a prolonged dollar crisis.
In December, commercial banks鈥� gross foreign currency balance fell to $4,255 million, down from $4,383 million in November, according to Bangladesh Bank data.
It marked the lowest level since June 2019, when balances stood at $4,191.18 million.
Bankers attributed the steep decline to BB Governor Ahsan H Mansur鈥檚 instruction for banks to clear a large portion of foreign dues by December 2024, exacerbating the dollar shortage.
Adding to the crisis, Bangladesh Bank halted dollar sales to commercial banks to prevent further reserve depletion while simultaneously purchasing dollars to prop up reserves. This dual approach has worsened the already strained market.
The exchange rate has surged steadily, from Tk 85.80 in December 2021 to Tk 104 in December 2022 and Tk 110 in December 2023. By December 2024, the rate reached Tk 128.
Despite an increase in remittance inflows and export earnings in recent months, commercial banks鈥� dollar holdings failed to recover.
Due to a considerable devaluation of the local currency, banks were hesitant to allow travelers to use foreign currency at lower rates, bankers said.
They further said that the banks were adjusting the rates in foreign currency accounts, potentially resulting in travelers obtaining available foreign currencies at higher prices.
The card-based foreign currency transactions started rebounding after July 2021 with relaxation of travel restrictions and the amount crossed Tk 250 crore in December 2021. In July 2022, it was Tk 441 crore.
The monthly average transaction volume through cards is now over Tk 600 crore for a year.
Foreign currency transactions using cards have experienced significant growth in the current financial year, as it has become much easier for travellers to obtain foreign currency through cards from banks, bankers said.
In addition, more and more people have found it safe and easy to use cards rather than bear cash currency notes, they said.
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A file photo shows a man counting US dollar notes in the capital Dhaka. The volume of foreign currency transactions made through cards declined in November compared with that in the previous month. 抖阴精品 photo