25,000 Crore Taka Leaves Banking Channel in a Month

Economic Desk

The Bangladeshi economy experienced contrasting trends in March, with a rise in bank deposits offset by an outflow of nearly 25,000 crore taka in cash. Economists question the destination of this significant cash outflow, highlighting concerns about informal transactions, tax evasion, and declining confidence in the financial sector.

Data from Bangladesh Bank shows an 8.51% growth in bank deposits in March, the highest since June 2023, reflecting increased depositor confidence due to higher interest rates, central bank oversight, and record remittances. Despite this, cash outside the banking system surged to 2,96,431 crore taka in March, up by 9.18% from February, with an annual growth rate of 13.49%.

Experts attribute this trend to informal economic activities, tax evasion, and public apprehension about financial stability. The cash surge coincided with Ramadan and Eid preparations, a period when cash demand typically rises for personal expenditures.

Bankers and economists emphasize the need for transparency, governance, and the promotion of digital transactions to curb reliance on cash. They also recommend competitive interest rates and enhanced customer services to retain deposits and strengthen the formal economy.

Unchecked cash dependency could impede digital payment adoption, reduce taxpayer numbers, and affect long-term revenue growth, experts warn.