Published :
Updated :
For all latest news, follow The Financial Express Google News channel.
The central bank of Bangladesh has introduced a contactless payment service for the first time in the country using the near-field communication (NFC) technology to make card-based transactions easer.
Under the new mechanism, the bankers will now be allowed to conduct transactions using 'EMVCo-Compliant' credit cards.
The maximum limit for such transactions has been fixed at Tk 3,000, according to a notification issued by the Bangladesh Bank (BB) on Thursday.
"The transactions will be made without any personal identification number (PIN)," a senior BB official told the FE while explaining the advantage of such transactions.
He also said the banks concerned would have to notify their clients about each transaction immediately through the short message service (SMS).
"We expect that such a payment system will help popularise card-based payment among people," the central banker noted.
Contactless payments are made in close physical proximity, unlike mobile payments which use broad-area cellular or WiFi networks and do not involve close physical proximity.
The NFC is a set of communication protocols that enable two electronic devices, one of which is usually a portable device such as a smart phone, to establish communication by bringing them within 4.0 cm of each other.
Senior bankers welcomed the BB move, saying that it would facilitate card-based transactions in Bangladesh.
"Actually, it is a touch-and-pay payment system," Md Amir Hossain Majumder, executive vice president and head of card division of Prime Bank Ltd, told the FE.
He also said it would help make small amounts of payment faster and secure.
Currently, more than 0.9 million credit cards are in use. Of them, over 0.6 million are EMV-compliant, according to Mr. Majumder.
EMV-which stands for Europay, Mastercard and Visa-is a global system of payment through cards equipped with computer chips and the technology used to authenticate chip-card transactions.