Monday, August 10, 2020

BB to introduce deposit scheme in local banks for expatriates

Economic Reporter :
The central bank is going to introduce a facility under which Bangladeshi expatriates will be able to open deposit accounts in any banks in Bangladesh.
The deposit scheme will be in the form of savings for a period of one year or above with monthly or quarterly deposit options. Foreign currency will be converted into taka in the accounts.
The Bangladesh Bank is preparing a circular in this regard, which will be issued soon, so that expatriates do not face financial problems after they return home permanently, according to officials of the bank.
An official of the central bank, seeking anonymity, said, "After the circular is issued, expatriates will be able to open deposit accounts in any bank in Bangladesh. Expatriates will have to deposit foreign currency in their accounts through banks or money exchange houses abroad, and the foreign currency will be converted to taka in the accounts in Bangladesh. If they come to the country on a temporary visit, they can deposit foreign currency to their accounts directly after filling up the Money and Jewelry (FMJ) Form of the banks concerned."
The initiative would help create a safety net for non-resident Bangladeshis, added the official.
Banks will be asked to provide competitive interest or profit on the deposits.
Besides, the central bank will ask all the banks to encourage the expatriates with incentives.
Non-resident Bangladeshis will be able to open the accounts without any instalment for the persons proceeding abroad for employment. Banks will be allowed to give loans in taka to non-resident account-holders for meeting their personal requirements against the security of the deposit accounts following usual lending norms.
On maturity, authorized dealers (branches of the banks concerned which deal with foreign currency) will pay the deposited money with interest to the beneficiaries or nominees of the accounts.
If the account holders want to open fixed deposit accounts with the money after the maturity of their deposit accounts, they will be able to do so.
In case they start living in Bangladesh permanently after their return, the deposited money can be made available to them either in a one-time settlement or in monthly or quarterly settlements like a pension.
The account holders can continue contributing to the deposit accounts from local earning sources after their arrival.

The circular will also include an option to send back the deposited money with interest after maturity to the account holders abroad with permission from the Bangladesh Bank.

Dr Tasneem Siddique, chairperson of the Refugee and Migratory Movement Research Unit, hailed the initiative and said that it would help expatriates meet their future needs after they return home.

"This initiative will be helpful for expatriates, especially those from the low-income group," she added.

Recently the flow of remittance has increased. In July this year, Bangladesh received $2.60 billion in remittance. The monthly inflow of remittance hit an all-time high in this month.

However, experts do not see any hope despite the increased flow of remittance because a significant number of migrant workers may come back home permanently because of the Covid-19 pandemic.

According to the Brac Migration Programme, around 2.5 lakh migrants have returned home from different countries amid the pandemic.