Khadija Akhter
The rising costs of conducting business in Bangladesh have begun to significantly impact cheque clearing transactions, reflecting broader economic challenges faced by enterprises across various sectors. Due to supply chain disruption, the business cost increased in between 30 to 50 percent, affecting the overall production and export, said industry insiders.
Increased operational costs, including raw materials, transportation, and labor, have compelled businesses to adopt stringent financial strategies, affecting cheque transactions.
Businesses are facing heightened financial pressures, prompting cautious spending and investment decisions, which are reflected in reduced cheque clearing activities.
BGMEA President MA Mannan Kochi said that the surge in business costs has tightened liquidity for firms, influencing their payment processes. Reduced cheque transactions indicate a shift towards cost-saving measures amid economic uncertainties." Higher operational expenses have necessitated prioritization of essential expenditures over financial transactions like cheque clearing. This trend underscores the need for targeted economic policies to alleviate cost burdens on businesses." Industries reliant on cheque transactions for supplier payments and operational expenses are particularly affected by the increased cost environment.
SMEs, often more sensitive to cost fluctuations, are adapting by exploring alternative payment methods to manage financial liquidity.
Cheque clearing transactions, encompassing MICR and Non-MICR processes, witnessed a significant downturn in April 2024, signaling broader economic challenges amidst inflationary pressures.
According to the Bangladesh Bank data, cheque clearing transactions, including MICR and Non-MICR, saw a notable decline of Tk. 7670.9 crore (3.88%) in April 2024, dropping to Tk. 189996.0 crore compared to March 2024 figures.From July 2023 to April 2024, cheque clearing activities recorded a substantial decrease of Tk. 97535.0 crore (4.68%) compared to the same period the previous year, reflecting broader economic trends amidst inflationary pressures.
Dr. Ahsan H. Mansur, Economic Analyst said: "The consecutive decline in cheque clearing indicates cautious spending behavior amid escalating inflation. Businesses are likely adjusting financial strategies to navigate economic uncertainties."
Dr. FahmidaKhatun, Executive Director at CPD said that this downturn in cheque transactions underscores broader economic challenges. The reduction suggests reduced commercial activities and liquidity constraints, impacting overall economic momentum."
The decrease in cheque clearing transactions underscores the need for adaptive economic policies to mitigate inflationary pressures and bolster economic resilience. Stakeholders emphasize the importance of addressing underlying economic challenges to sustain growth and financial stability.
As economic indicators evolve, stakeholders continue to monitor trends closely, assessing strategies to support recovery and stability in Bangladesh's economic landscape.
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