FEPD Circular No. 34: Inward wage remittances by Mobile Financial Service Providers

Foreign Exchange Policy Department Bangladesh Bank Head Office Dhaka www.bb.org.bd FE Circular No. 34 Date: November 29, 2022 All Authorized Dealers in Foreign Exchange and all licensed Mobile Financial Service Providers in Bangladesh Dear Sirs, Inward wage remittances by Mobile Financial Service Providers (MFSPs) Please refer to FE Circular No. 20 of August 10, 2022 in terms of which Authorized Dealers (ADs) are allowed to make drawing arrangements with exchange houses abroad without prior permission from Bangladesh Bank. ADs are also allowed to go for drawing arrangements without letters of references/certificates from the Bangladesh Embassy/High Commission of the respective country. 02. To bring wider flexibility, licensed MFSPs will be allowed to repatriate wage earners’ remittance in association with internationally recognized online payment gateway service providers (OPGSPs)/banks/digital wallets/card schemes and/or aggregators abroad (hereinafter referred to as approved/licensed foreign payment service providers, foreign PSPs). In this context, MFSPs shall have standing arrangements with foreign PSPs to receive foreign currency in their account and equivalent Taka value will be credited to the wage earners’ MFS accounts. Subsequently foreign PSPs shall provide credit to the designated AD’s nostro account. After receiving amount in Taka, wage earners’ can use the MFS account from abroad to do all transactions in Taka. 03. A wage earners’ can open MFS account in Taka through proper e-KYC along with validated proof of departure from Bangladesh (arrival or departure date stamped page of the passport). On return to Bangladesh, such account can be converted to local MFS account. This account may be converted again to wage earners’ MFS account with the proof of departure. It is important that wage earners MFS account can only be credited against foreign currency. Cont’d page -2

-2- 04. ADs are advised to provide settlement account services to MFSPs. Operational procedures in this regard are as follows: (a) ADs shall transfer the fund, on receipt in their nostro accounts, to settlement accounts in equivalent Taka of MFSPs. (b) As an alternative to (a) above, ADs may maintain accounts in the name of foreign PSPs at their desire in foreign currency/Taka as per paragraph 1(i), chapter 13 and paragraph 8(b), chapter 14 of the Guidelines for Foreign Exchange Transactions-2018, Vol-1 to facilitate the said transfer by debit the accounts. 05. Due diligence in respect of the transactions needs to be observed regarding foreign exchange/payment systems regulations, KYC and AML/CFT standards and relevant laws/regulations in force. As usual, ADs shall observe usual reporting routine to Bangladesh Bank with specified purpose. 06. MFSPs desirous for providing repatriation services shall apply to Foreign Exchange Policy Department at Bangladesh Bank head office within December 31, 2022 with details of proposed arrangements in accordance with framework outlined above or similar conducive procedures. Bangladesh Bank will primarily accord permissions on review of arrangements for piloting the initiative. Please bring the contents of this circular to the notice of your concerned constituents. Yours faithfully, (Md. Sarwar Hossain) Director (FEPD) Phone: 9530123