IT service exporters can now bring in remittance thru mobile financial service

The Bangladesh Bank has now allowed mobile financial service (MFS) providers to expatriate inward remittance of IT service exporters, including freelancers.

Such remittance services were earlier provided only by banks, according to a central bank circular issued on Wednesday.

An official of the central bank said it will help a lot to bring in foreign incomes of the IT service exporters. In this case, local MFS providers need to play a proactive role for arrangements with their counterparts abroad.

In 2011, the Bangladesh Bank allowed authorised dealer banks to make arrangements with online payment gateway service providers to repatriate proceeds of small value service exports, he also said.

Considering the volume of small value transactions, an alternative delivery channel of MFS providers is now a need of time, he added.

The new policy supports are expected to be beneficial to IT exporters, freelancers in particular, for easy repatriation of service income, he noted.

The new circular has advised MFS providers to follow specific instructions. They will have to make standing arrangements with internationally recognised foreign payment service providers like online payment gateway service providers and digital wallet providers or aggregators operating in multiple countries.

MFS providers will have to maintain settlement accounts in equivalent local currency with respective authorised dealer banks. The circular has instructed the banks to transfer funds received from foreign payment service providers in their Nostro accounts abroad to settlement accounts of MFS providers. Based on this fund, they will make funds available to digital wallets of exporters.

Foreign payment service providers can maintain accounts in taka or in foreign currency with authorised dealer banks for settlement of such payments. The authorised dealer banks can extend overdraft facilities over the accounts against payment guarantees based on the transaction flows, the circular cited.

Exporters are entitled to retain foreign currency in retention quota accounts. The circular allows such accounts to be maintained by authorised dealer banks.

Retention quote accounts need to be credited with foreign currency before making credit of the funds to the settlement accounts in taka of MFS providers.

In another circular issued on the same day, the Bangladesh Bank has allowed authorised dealer banks to extend transactions facilities to incoming tourists or passengers who bring money in their digital wallets.

Under the policy, the banks are allowed to make agreements with foreign digital wallets.