The Payment and Settlement System Act, 2024, now in effect, enables Bangladesh Bank to pursue legal action against Nagad Limited over alleged operational irregularities. A gazette notification issued by the Financial Institutions Division formalized the legislation, granting certain clauses retrospective effect from August 12, 2023. The central bank had appointed an administrator at Nagad under section 31 of the act in August, citing irregularities. However, as the law had not been officially gazetted, Nagad questioned the appointment’s legitimacy.
In response, Bangladesh Bank sought government intervention to issue the necessary gazette. Meanwhile, a High Court writ petition filed by a Nagad director led to a status quo restricting the administrator’s activities. The court’s final verdict is expected soon. Nagad, launched as part of the Bangladesh Post Office in 2019, continues to operate on a temporary license, raising concerns about regulatory oversight in the fintech sector.
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