BB paves way for PayPal, Payoneer-style cross-border digital payment services
Before launching such services, banks will have to obtain prior regulatory acknowledgement from BB by submitting details of their their partnerships, technology infrastructure, cybersecurity measures and compliance arrangements.
Highlights:
- BB introduces bank-intermediated framework for cross-border digital payments
- Banks can partner with platforms such as PayPal, Payoneer and Stripe
- Digital Value Accounts to facilitate overseas payments and remittances
- Freelancers, exporters and businesses to benefit from new payment system
- Foreign visitors will also be able to make digital payments in Bangladesh
The Bangladesh Bank has introduced a bank-intermediated framework for cross-border digital payments, paving the way for local banks to partner with international payment platforms such as PayPal, Payoneer and similar service providers.
This decision is likely to overhaul Bangladesh's digital trade infrastructure, removing barriers for freelancers, easing software procurement for startups, and integrating local merchants directly into the global digital economy.
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In a circular issued today (29 July), the central bank cleared authorised dealer (AD) banks to offer cross-border digital payment services through partnerships with foreign payment platforms, digital wallets, online payment gateways and other approved payment solution providers – collectively termed cross-border digital payment service providers (CDPSPs).
It said the initiative is aimed at modernising the country's payment ecosystem, facilitating international trade in services and expanding digital financial inclusion.
While Payoneer already operates in Bangladesh and PayPal's Xoom service offers limited inbound remittance facilities, the new circular establishes a comprehensive regulatory framework enabling banks to offer the full range of services of cross-border digital payment service providers.
Under the new guidelines, local banks can now directly partner with foreign digital payment service providers to streamline both inward and outward international transactions.
While the framework imposes strict regulatory oversight through real-time parallel ledgers and small-value payment caps, its economic ripple effects will be profound, driving formal banking adoption among gig workers, expanding international trade in digital services, and unlocking new foreign consumer spending within the local economy.
A key feature of the framework is the introduction of Digital Value Accounts (DVAs) – digital wallets or stored-value accounts opened in customers' names. However, these wallets will not operate independently.
Each DVA must be linked to a Master DVA, or settlement account, maintained by the partner bank to ensure regulatory oversight, fund security and settlement control.
Banks will also be required to monitor all transactions in real time through their own systems and maintain a parallel ledger of DVA transactions. Any unused balance must remain under the bank's control and be refunded or adjusted in line with regulatory requirements.
The framework now allows individuals, businesses and freelancers to use the service for a range of approved foreign currency transactions.
DVAs may be used for travel-related foreign exchange under private, medical and official travel quotas, as well as for visa processing fees, hotel bookings, membership fees and IT-related services.
Users will also be able to make international online payments of up to $300 per transaction.
The facility may also be extended against balances held in Export Retention Quota (ERQ) and Resident Foreign Currency Deposit (RFCD) accounts. For corporate ERQ account holders, up to three senior officials will be permitted to use DVAs for business-related expenses.
The framework is expected to make it easier for freelancers and e-commerce entrepreneurs to receive overseas earnings through regulated digital payment channels.
It will also allow foreign nationals and tourists visiting Bangladesh to make digital payments at local merchant outlets.
However, before launching the services, banks must obtain prior acknowledgement from Bangladesh Bank's Foreign Exchange Policy Department by submitting details of their partnerships, technology infrastructure, cybersecurity measures and compliance arrangements.
Participating banks must also comply with anti-money laundering (AML) and customer due diligence (CDD/KYC) regulations and regularly submit transaction reports to the central bank.
According to stakeholders, the move significantly expands Bangladesh's regulated digital payment infrastructure. Previously, banks were largely permitted to use online payment gateway service providers (OPGSPs) only for inward remittance transactions.
Market observers believe the framework could encourage global platforms such as PayPal, Payoneer and Stripe to expand their presence in Bangladesh.
The central bank move comes as the government recently stepped up efforts to bring PayPal to Bangladesh. During a question-and-answer session in parliament on 15 April, Prime Minister Tarique Rahman said a special committee had been formed to facilitate the launch of the international payment gateway. Chaired by Rehan Asif Asad, adviser to the Ministry of Posts, Telecommunications and Information Technology, the committee includes the Bangladesh Bank governor, the Bida chairman, the NBR chairman and other senior officials.
PayPal had so far expressed interest in entering Bangladesh on several occasions.
Earlier this year, Lutfey Siddiqi, the interim government's special envoy on international affairs, said discussions were under way with PayPal, although the process could take time.
In December 2025, former Bangladesh Bank governor Ahsan H Mansur had also said the service would primarily support freelancers, e-commerce entrepreneurs and the IT sector. PayPal's South Asia team later visited Bangladesh and held meetings with freelancers and ICT Division officials.
