Q-Cash upgrade catches banks, customers off guard

Digital banking and card-based services at as many as 33 banks have been disrupted following a sudden system upgrade by Q-Cash, an electronic payment network used by the lenders.

Senior officials at several banks said Q-Cash had not notified them early enough to allow them to inform customers in advance. Some customers received text notifications only hours before or after the upgrade began. 

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The upgrade began Sunday night and is scheduled to continue until noon on October 10.

Affected services include ATM cash withdrawals, point-of-sale (POS) transactions, interbank fund transfers, card verification, e-commerce payments, Bangla QR transactions, and cash deposits and withdrawals through mobile financial services, according to text messages sent by banks to customers.

The disruption comes at the start of the month, when salaried workers typically withdraw funds to cover monthly expenses.

Q-Cash, the country’s largest independent bank-driven ATM, POS and merchant transaction network, connects cards and ATMs from different banks through a single platform, allowing customers to conduct transactions across the network. It is operated by IT Consultants PLC (ITC).

The Bangladesh Bank said the lenders did not inform the central bank about the six-day disruption.

KM Awlad Hossain, managing director of Bengal Commercial Bank, said the lender notified customers on Sunday after Q-Cash informed it that the system migration would begin within hours.

An NCC Bank official also gave a similar account.

“Many banks received the notification late, making it impossible to inform customers and the Bangladesh Bank in advance,” the official said, requesting anonymity.

“They informed us while one of our marketing campaigns was running. Because of this reckless decision, we will suffer greatly,” the official added.

A notice posted at Community Bank ATM booths in Dhaka said the migration was being carried out across all member banks of the Q-Cash network and could temporarily affect services.

According to the notice, transactions through ATMs and POS terminals using the bank’s debit, prepaid and credit cards would remain suspended during the period. The same applied to transactions through POS and Bangla QR, interbank fund transfers through iBanking, and credit card bill payments.

Because many banks use more than one electronic payment network, the upgrade disrupted only some services at certain lenders rather than their entire digital banking and card operations.

Muhit Rahman, managing director of One Bank PLC, said their customers had not experienced disruptions to card transactions because the bank has an alternative electronic payment network.

Bangladesh Bank officials said lenders are required to notify the central bank before implementing major changes or upgrades to their IT systems. The central bank then issues necessary directives and facilitates customer notification.

Arief Hossain Khan, executive director and spokesperson for Bangladesh Bank, said the central bank was not informed of the upgrade.

He added that customers were not given advance notice and that the abrupt suspension had caused widespread dissatisfaction.

“The central bank should have been informed beforehand. Since that was not done, action will be taken against them,” he said.

Speaking on the matter, Kazi Saifuddin Munir, managing director of IT Consultants, the parent company and operator of Q-Cash, said the migration had originally been scheduled for October 28 and that the company had communicated that plan to member banks and the Bangladesh Bank.

“However, due to unavoidable circumstances, we had no other option but to immediately proceed with full migration to the new system. We are now trying to make all services available by Thursday evening,” he said.