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How the Digital Payment System will Impact the Growing eConomies?

The modern era is the age of digitalization and the economic and monetary system is also changing. Countries are now moving towards digital payment systems to make monetary transactions safer and more efficient. The case with Bangladesh is no different.

Recent researches and observations have concluded that the use of digital payment system has a lot of positive impacts on the economy of a country. This switch is helping economies stabilize and experience an overall increase of around three percent in the GDP of the country. Thus, digital payment systems are not only great for the overall economic growth but also bring fruitful results for the common men in a country.

What Is A Digital Payment System?

As the name indicates, a digital payment system involved digital or online means of money exchange. Whether it be shopping, paying bills or even the process to send money to Bangladesh, no hard cash is involved. The money is transferred from the sender’s account to the recipient’s account by virtual means without having to use printed cash. Online money transfer and international remittance is a common scenario in which digital modes of payment are utilized.

Why Digital Payments?

The popularity of digital payments is gaining momentum at a rapid rate for a number of reasons. The most common reason for this is convenience and ease. No need to carry cash with you all the time. Simply use your cards or a mobile app to make transactions. This is also making the payments a lot safer as the risk of theft of digital money is a lot less as compared to the theft of real money.

At the same time, transparency is also one of the pros of digital payment methods. Everything is recorded and there is lesser threat of under the table dealings and money laundering. The economy also benefits from digital cash in terms of saving money. The cost of printing and maintaining money can sum up to be a lot. With this method, this cost can be cut down to a certain extent. Consumers will also save money at the end of the day as they will not have to pay ATM charges and cheque book costs.

Benefits For Economy:
The economy of any country can hugely benefit from the use of digital means of payment. Some of the advantages are as follows:

  • Tax Collection: When money is dealt with as a digital asset, everything is recorded and taken into account. Therefore, people are unable to hide their incomes and tax collection is made a lot easier.
  • Tracking The Flow Of Money: Digital payments make tracking the flow of money extremely easy. Every transaction has a digital footprint and can be revisited whenever needed.
  • Liquidity Expansion: Accessibility of digital cash is a great advantage. With easier access to money, the banking system will flourish and the interest rates on loans will be lowered. This will make things a lot easier for the ones in need and economic activity will be promoted.

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