FEPD Circular No. 26: Policy on the Issuance, Operation and Renewal of Limited Money Changers

Foreign Exchange Policy Department Bangladesh Bank Head Office Dhaka Ref. No. FEPD-Circular-26 Date: 02 July, 2025

To all Approved Dealers in Foreign Exchange Transactions.

Dear Sir,

Policy on the Issuance, Operation and Renewal of Limited Money Changer Institutions.

Under Section 3 of the Foreign Exchange Regulation Act, 1947 (amended up to 2015), Bangladesh Bank issues Approved Dealer (AD) licenses. Under the existing arrangement, Approved Dealer licenses are issued in favor of branches of scheduled banks or their Central Processing Centers, and Limited Money Changer licenses are issued in favor of branches/bank booths of scheduled banks, hotels, gift shops, and other institutions. The procedures for applying for a Limited Money Changer license, eligibility for license issuance, scope of business, license renewal process, liabilities, and other matters are as follows:

2. Procedure for submitting application for Limited Money Changer license: To obtain a Limited Money Changer license, applications along with the documents listed below must be submitted to the Director, Foreign Exchange Policy Department (Division-2), Bangladesh Bank, Head Office, Dhaka, through the Head Office of scheduled banks operating in Bangladesh and through AD banks for other institutions.

(a) For Approved Bank Branches/Bank Booths: (i) Copy of the approval/license issued by the Banking Regulation and Policy Department (BRPD) of Bangladesh Bank, Head Office, in favor of the concerned bank branch/booth; (ii) Description regarding experienced personnel, infrastructure, security arrangements, and use of communication/IT for work related to foreign exchange transactions at the applicant bank's branch/booth (with appropriate evidence); (iii) Justification and relevant evidence in favor of foreign exchange transactions.

(b) For other institutions: (i) Information along with necessary documents regarding the nature/type of business and the necessity of obtaining the license; (ii) Copy of the updated Trade License; (iii) Copy of the updated Tax Identification Number (TIN) certificate, Business Identification Number (BIN) certificate, and all types of licenses/registrations/certificates obtained from other authorities under the name of the business establishment; (iv) If the applicant institution is a registered company, copies of the Certificate of Incorporation, Memorandum of Association, and Articles of Association of the said company, and the annual accounts of the previous year; (v) If the establishment is located in a self-owned place, the ownership document; if located in a rented place, a copy of the lease agreement executed with the owner of the said place; (vi) Description regarding the infrastructure, security arrangements, and capability in the use of communication/IT of the applicant institution, along with a brief description of business experience (with appropriate evidence); (vii) A Pay Order/Bank Draft of 50,000.00 (Fifty Thousand) Taka (non-refundable) for the license fee, issued in favor of the Director, Foreign Exchange Policy Department (Division-2), Bangladesh Bank, Head Office, Dhaka, upon receiving the initial no-objection.

3. Scope of business of licensed institutions: (a) For Approved Bank Branches/Bank Booths: (i) The issued license shall not be transferable under any circumstances; (ii) The licensed institution may change its business location with the approval of Bangladesh Bank; (iii) Licensed bank branches/booths may conduct foreign exchange purchase/sale, dollar endorsement on passports of foreign nationals, encashment, and other transactions mentioned in the issued license; (iv) Approved bank branches/booths in the Dhaka region shall submit monthly reports of foreign exchange transactions to the Foreign Exchange Operations Department (Division-2), Bangladesh Bank, Head Office, Dhaka, and to the concerned offices of Bangladesh Bank in other regions, through their AD bank, in accordance with Circular No. FEPD-Circular-2018-1, Clause-1, Clause-5/2; (v) Licensed institutions shall comply with all relevant instructions issued or to be issued by Bangladesh Bank from time to time.

(b) For other institutions: (i) The license shall not be transferable under any circumstances; (ii) The licensed institution shall not change its business location without the prior approval of Bangladesh Bank; (iii) The licensed institution may only accept cash foreign currency from foreign passport holders against the sale of its goods/services. The accepted foreign currency must be converted into local currency through the approved AD bank within the next working day. However, the institution may retain a maximum of USD 1,000.00 (One Thousand) or equivalent other approved foreign currencies for transaction convenience; (iv) Institutions located within the Dhaka region shall submit monthly reports of foreign exchange transactions to the Foreign Exchange Operations Department (Division-2), Bangladesh Bank, Head Office, Dhaka, and to the concerned offices of Bangladesh Bank in other regions, through their AD bank, in accordance with Circular No. FEPD-Circular-2018-1, Clause-1, Clause-5/1; (v) Licensed institutions shall comply with all relevant instructions issued or to be issued by Bangladesh Bank from time to time.

4. Duration of license and procedure for renewal: (a) For bank branches/booths, there is no need to renew the said license. (b) For other institutions, the license duration shall be 02 (two) years. Such institutions must submit an application for renewal for the next 02 (two) year period to the Foreign Exchange Operations Department (Division-2), Bangladesh Bank, Head Office, Dhaka, and to the concerned offices of Bangladesh Bank in other regions, through their AD bank, along with the following documents 02 (two) months prior to the expiration of the license period: (i) Copy of the updated Trade License; (ii) Tax Clearance Certificate/Tax Assessment Order determined by the Income Tax Authority; (iii) Authentic documents in favor of VAT (Value Added Tax) payment against sold goods or services, and proof of VAT payment for the previous year; (iv) Information on foreign exchange transactions for the previous one year; (v) A fee of 10,000.00 (Ten Thousand) Taka (non-refundable) for license renewal must be deposited via EFT from the institution's AD bank account held with the Director, Foreign Exchange Operations Department (Division-2), Bangladesh Bank, Head Office, Dhaka; and for institutions located outside Dhaka, via EFT to the concerned Regional Office of Bangladesh Bank through the AD bank according to the prevailing procedure; (vi) Copy of the updated licenses/registrations/certificates of all types obtained from other authorities under the name of the applicant institution; (vii) If the establishment is located in a self-owned place, the ownership document; if located in a rented place, a copy of the updated lease agreement executed with the owner of the said place.

5. Power of Bangladesh Bank to grant/reject license and inspect: Bangladesh Bank may inspect bank branches/booths and other institutions applying for licenses on the spot. During the inspection, information and authentic documents regarding foreign exchange transactions must be properly preserved to facilitate the inspection team of Bangladesh Bank.

6. Bangladesh Bank reserves the right to cancel the previously granted license without assigning any reason if licensed institutions fail to perform their assigned duties and/or fail to comply with instructions issued by Bangladesh Bank under the Foreign Exchange Regulation Act, 1947, or are involved in anti-state activities.

7. To prevent money laundering and financing of terrorism, licensed institutions must ensure compliance with the prevailing laws, rules, and regulations of the country, and circulars, circular letters, and other instructions issued by the Bangladesh Financial Intelligence Unit (BFIU) from time to time.

8. Notice boards clearly written in Bengali and English must be installed in places easily visible to customers, stating the license, the notification regarding Limited Money Changers, and the daily exchange rate for foreign exchange.

9. Bangladesh Bank reserves the power to grant or reject licenses for conducting limited foreign exchange transactions.

Advisory is given to inform all concerned about the above instructions.

Yours faithfully, (Monowar Uddin Ahmed) Director Phone: 9530119