Bangladesh’s banking sector is under severe strain. Non-performing loans now exceed Tk 4.2 trillion, public banks remain effectively insolvent, and confidence in financial governance is at a dangerous low. Recent reforms—from stricter Basel III compliance to a new Bank Resolution Ordinance—have yet to deliver meaningful results. Asset recovery is sluggish, regulatory oversight remains fragile, and public trust has not been restored.
Yet, in the midst of this turbulence, a different story is unfolding: digital innovation. The launch of Google Pay in Bangladesh, in partnership with City Bank PLC, may be the year’s most consequential financial development. For the first time, a global fintech giant has entered the local ecosystem, enabling tap-to-pay, bill settlements, and instant transfers. For millions of digitally savvy Bangladeshis, this is a new level of convenience. For the underserved, it represents the possibility of entry into the formal financial system with a simple touch.
City Bank’s initiative highlights a crucial divide. While state-owned banks remain mired in legacy problems, private institutions are forging ahead. Eastern Bank, for instance, has introduced the world’s first biometric metal card—a milestone that underscores both its appetite for innovation and its commitment to delivering a top-tier banking experience. BRAC Bank’s lifestyle super app and interoperable platforms such as Binimoy and Bangla QR are likewise redefining how money moves in Bangladesh. Together, these efforts show that resilience and creativity are not absent in the financial sector—they are simply concentrated in its more dynamic corners.
At the same time, structural reform cannot be avoided. The government’s push for bank mergers, if implemented with transparency and rigor, could provide an antidote for the sector’s chronic weaknesses. Mergers offer a way to consolidate fragile banks, absorb toxic assets, and build stronger balance sheets. But success will depend on execution: mergers must be driven by commercial logic, not political expediency, and must be paired with governance reforms to prevent the creation of larger but equally dysfunctional institutions. Done right, consolidation could reduce systemic risk and create banks better equipped to compete in a digital era.
But innovation and mergers alone cannot rescue the system. Without robust regulation, stronger cyber-security, and real accountability, even the most sophisticated digital tools could be undermined by the same governance failures that created today’s crisis. The Google Pay–City Bank partnership, therefore, must be seen not merely as a technological upgrade but
Yet, in the midst of this turbulence, a different story is unfolding: digital innovation. The launch of Google Pay in Bangladesh, in partnership with City Bank PLC, may be the year’s most consequential financial development. For the first time, a global fintech giant has entered the local ecosystem, enabling tap-to-pay, bill settlements, and instant transfers. For millions of digitally savvy Bangladeshis, this is a new level of convenience. For the underserved, it represents the possibility of entry into the formal financial system with a simple touch.
City Bank’s initiative highlights a crucial divide. While state-owned banks remain mired in legacy problems, private institutions are forging ahead. Eastern Bank, for instance, has introduced the world’s first biometric metal card—a milestone that underscores both its appetite for innovation and its commitment to delivering a top-tier banking experience. BRAC Bank’s lifestyle super app and interoperable platforms such as Binimoy and Bangla QR are likewise redefining how money moves in Bangladesh. Together, these efforts show that resilience and creativity are not absent in the financial sector—they are simply concentrated in its more dynamic corners.
At the same time, structural reform cannot be avoided. The government’s push for bank mergers, if implemented with transparency and rigor, could provide an antidote for the sector’s chronic weaknesses. Mergers offer a way to consolidate fragile banks, absorb toxic assets, and build stronger balance sheets. But success will depend on execution: mergers must be driven by commercial logic, not political expediency, and must be paired with governance reforms to prevent the creation of larger but equally dysfunctional institutions. Done right, consolidation could reduce systemic risk and create banks better equipped to compete in a digital era.
But innovation and mergers alone cannot rescue the system. Without robust regulation, stronger cyber-security, and real accountability, even the most sophisticated digital tools could be undermined by the same governance failures that created today’s crisis. The Google Pay–City Bank partnership, therefore, must be seen not merely as a technological upgrade but
as a test: can Bangladesh align world-class innovation with credible local oversight?
The choice ahead is stark. One path leads further into insolvency and mistrust. The other—anchored in responsible innovation, customer trust, and bold reform—offers renewal. City Bank’s step with Google Pay shows what is possible. The challenge now is to ensure such sparks of progress, along with meaningful structural reforms like well-executed mergers, ignite a broader transformation, guiding Bangladesh toward a modern and resilient financial sector.
Zakaria Masud
Editor
