Bangladesh Bank Imposes Minimum One Per Cent Bangla QR Transaction Fee

In a move aimed at bringing greater structure to the country’s burgeoning digital payment ecosystem, Bangladesh Bank has introduced a minimum floor rate for digital transaction fees. The central bank has mandated a minimum Merchant Discount Rate (MDR) of 1 per cent, inclusive of Value Added Tax (VAT), on transactions settled via the National Payment Switch Bangladesh (NPSB) using the ‘Bangla QR’ platform.

The new directive applies across a broad spectrum of digital payment methods, including bank accounts, debit cards, prepaid cards, credit cards, mobile financial services (MFS), and payment service providers (PSPs). Previously, there was no baseline fee for withdrawing these funds from banks, which often allowed merchants to enjoy lower operational costs.

According to a circular issued by the central bank, this policy builds upon a previous directive issued on 6 February 2025, which had capped the maximum discount rates for Point of Sale (POS), Bangla QR, and e-commerce transactions. While all other previous charges and conditions remain unchanged, the newly enforced 1 per cent minimum floor specifically targets Bangla QR-based merchant payments. The central bank stated that the measure is designed to make digital transactions more disciplined and sustainable in the long term.

However, the decision has sparked concerns within the banking sector. Central bank officials and commercial bankers admit that the move could inadvertently discourage small and medium-sized vendors from adopting cashless methods. Prior to this directive, fees fluctuated wildly, with some banks and MFS providers charging anywhere between 0 and 3 per cent. Merchants who previously benefited from zero-fee or sub-one per cent rates will now face an immediate increase in business costs, potentially prompting a shift back to cash transactions.

Recognising that this policy could stifle the momentum of a cashless economy, Bangladesh Bank has included a provision allowing acquiring financial institutions to offer promotional waivers. Banks and MFS providers can temporarily reduce or waive the fee for specific periods to encourage digital adoption among merchants, ensuring that the transition does not completely derail the country’s financial inclusion goals.