BRPD Circular Letter No. 07: Directives on Agent Banking Operation

BRPD Circular Letter No. 07: Directives on Agent Banking Operation Banking Regulation and Policy Department Bangladesh Bank Head Office Dhaka. 24 March, 2014 BRPD Circular Letter No.-07 Date: ---------------------- 10 Chaitra, 1420 Managing Director/Chief Executive All Scheduled Banks operating in Bangladesh Dear Sir, Regarding the operation of Agent Banking Business. A guideline has been issued through Payment Systems Department, Bangladesh Bank Circular No.-5, dated: 09 December, 2013 for the operation of Agent Banking Business. In addition to the aforementioned guideline for the operation of Agent Banking Business, the following instructions must be complied with:

1. To obtain approval for the operation of Agent Banking Business, an application must be submitted to this department along with the following documents: a) Sample copy of the agreement to be executed with the agents; b) Agent Banking related business plan (including Business Continuity Plan); c) Agent Banking related policy approved by the Bank's Board of Directors (including Agent Banking Model, Agent appointment related policy, Agent Banking risk control and monitoring related method, Products/Services selected for Agent Banking, Schedule of Charges, etc.).

2. Approval for the operation of Agent Banking Business by banks will be granted by this department. Under this, banks may appoint agents in accordance with their own policies. The list of appointed agents for the supervision of Agent Banking Business and copies of executed agreements, along with relevant documents, must be sent to the Green Banking and CSR Department of Bangladesh Bank;

3. Each agent must maintain a current account with the concerned bank for the operation of Agent Banking Business. The maximum balance of the said account shall be 10 (ten) lakh Taka. In each customer transaction, a maximum of 25 (twenty-five) thousand Taka may be deposited or withdrawn in cash, and daily maximum 2 (two) cash withdrawals and 2 (two) cash deposits may be made. However, this withdrawal limit shall not apply to inward remittances;

4. 'Any person related to the bank' mentioned in the explanation of Section 26(g) of the Bank Companies Act, 1991 shall not be appointed as an agent;

5. Agent Banking Business must be operated in non-metropolitan areas, i.e., outside metropolitan/city corporation/municipal areas;

6. Shariah-based banks may only provide Islamic banking services through agents, and

7. Transactions made by customers through agents must be brought under the coverage of insurance.

These instructions shall come into force immediately. Kindly acknowledge receipt.

Yours faithfully, (Md. Anowarul Islam) Deputy General Manager Phone: 9530094