Banks withdraw service charge on remittance

Banks in Bangladesh today decided to withdraw service charge on remittances sent home by expatriate Bangladeshis with a view to gearing up the inflow.

Besides, banks will also keep open their exchange houses located on foreign locations during holidays to enable migrant workers remit money smoothly.

The decision was taken at a meeting between the Bangladesh Foreign Exchange Dealers' Association (Bafeda) and the Association of Bankers, Bangladesh at Sonali Bank's head office in the capital.

Md Afzal Karim, chairman of the Bafeda, an organisation that implements foreign exchange-related policies, announced the decisions at a media briefing after the meeting.

He said banks usually take $1 to $2 as service charge from the remitters based on the amount of remittances and number of transactions.

But from now on, there will be no such service charge, he said.

On top of that, expats can visit exchange houses of local banks during their holidays as the outlets will remain open on the days, said Karim, who is also the managing director of Sonali Bank.

Banks in Bangladesh have been facing an acute shortage of US dollars in recent days thanks to the higher import payments against the lower-than-expected export earnings and the downward trend of remittances.

Remittances to Bangladesh declined by 7.4 per cent year-on-year to $1.52 billion in October.

Under such a situation, the country's foreign exchange reserves stood at $35.73 billion as of November 2, down 23 per cent year-on-year.

Bafeda and ABB also refixed the exchange rate for exporters.

Under the new rate, exporters will get Tk 100 against each US dollar, compared to Tk 99.50 now.

The importers will continue to buy the greenback based on the weighted average exchange rate plus Tk 1.

The average rate will be decided based on the rates paid to the exporters and exchange houses.