Dhaka, Bangladesh (BBN) – The central bank of Bangladesh formally launched the Real Time Gross Settlement (RTGS) system on Thursday aiming to facilitate business activities across the country.
“RTGS is a great achievement for the banking sector of Bangladesh which should also be treated as a landmark in the achievement of dream of Digital Bangladesh of the current government,” Bangladesh Bank (BB) Governor Dr. Atiur Rahman said while inaugurating the modern payment system at the central bank headquarters in the capital Dhaka in the morning.
The central bank chief also said: “Now, we proudly compare our payment and settlement system to any other payment system around the globe.”
The system will have a substantial impact on current operations in the banks, particularly in the area of treasury, payment division, corporate banking and cash management, BB Governor Dr. Rahman explained.
Trading in intra-day liquidity and efficient fund transfer will provide a boost to the secondary bond market which in turn offers opportunity to earn revenue, he added.
“Establishment of state of art payment infrastructures will convey a clear signal about our concerted effort of digitization in Bangladesh to Non-Resident Bangladeshis (NRBs) and foreign investors to remit, transfer and invest fund in Bangladesh,” Dr. Rahman noted.
With the financial assistance of Asian Development Bank (ADB) under the project Institutional Support for Migrant Worker’s Remittances, Bangladesh RTGS is implemented under Component A: Remittance and Payment Infrastructure Development.
The RTGS, which can be defined as the continuous (real-time) settlement of funds transfers individually on an order by order basis (without netting).
‘Real time’ means the processing of instructions at the time they are received rather than at some later time. ‘Gross Settlement’ means the settlement of funds transfer instructions occurs individually (on an instruction by instruction basis).
Among others, Deputy Governor of BB Ms. Nazneen Sultana, Executive Director Mr. Subhankar Saha, Managing Director of Dutch-Bangla Bank Limited K. Shamshi Tabrez and Managing Director of CMA Small Systems AB Mr. Alexey NAZAROV spoke on the occasion.