"Everywhere you want to be": what some take for granted but many can't have

Do tip jars still exist in San Francicso?  Bet it's easier to get
tips in cash-based economies like Kathmandu and Dhaka
(photo from Cafe Kora, Kathmandu).

I know some people who essentially use only digital money.  That is, the only thing in their wallet is plastic.  If that's your daily life, it's easy to take it for granted and forget how awesomely convenient it is.

And Americans have it good this way--our cards are accepted almost everywhere.  I should know, I hopped off the plane in Hong Kong, walked up to an ATM, and walked out with a wallet full of Hong Kong dollars.  I bought a boatload (literally) of champagne and other drinks in Chiang Mai at a grocery store, simply by swiping my visa.  The hotel where I'm staying this week asked for a deposit, and I handed them my card again.  Easy as pie.

The Bangladesh government historically has had very strict rules on Bangladeshis taking money abroad, only recently beginning to allow small amounts of international credit card usage (for most people, the annual spending limit internationally is $5,000 and per online transaction it's $100, up to 1,000 annually).  Baby steps.  Online credit card payments WITHIN Bangladesh were only approved in 2009.

Imagine:

• You're going on a trip to another country.  You have to take all your money in cash.  If you stay at a hotel in the US and you don't have a credit card, you often must put down $1000 or more as a security deposit, so make sure you take extra.  Hope you have one extra big money belt!
• You want to apply to a university outside of Bangladesh.  To submit your application, you must pay a fee online.  There are entire centers in Bangladesh set up just to help students submit applications, for a steep fee.
• You want to use iTunes? Skype? Dropbox? Kindle?  How do you intend to pay?  They don't even sell those handy "prepaid cards" anywhere that I know.
• Doing freelance work?  Good luck getting paid...Paypal doesn't support Bangladesh.  Which has led to some interesting workarounds (at a fee, of course) like this one.  Or this Facebook page where you can buy people's leftover balances.

So how do you think that e-commerce is doing in Bangladesh?  Most of the sites I use are still cash on delivery--for example, you can reserve airline tickets online, but then you need to actually go to the office and pay for them!  With mobile money (the ability to send and receive money on cell phones) picking up, this is potentially a way around some of these issues, but not the international ones and I would argue not as convenient for regular or large payments, without serious upgrades.  Still, earlier this year studies reported that 99% of daily purchases in Bangladesh are done in cash (global average is 84%; statistics from link below).

"Digital" financial services in Bangladesh--still largely
person-to-person transfers through a human agent by
mobile (Photo from Bogra).

Not hard to understand why less only 700,000 people have credit cards and three million have debit cards (out of 153 million)!

There's very little written about how these issues of intense control on credit card utilization, particularly on international transactions, can impede development. In emerging markets, Moody's analytics estimated that electronic payments can contribute up to 0.8% to GDP annually. This has huge implications for economic opportunity, e-commerce, and entreprenuership in an increasingly virtual world.

Why aren't we talking about this?