Further Simplification of Foreign Investment in Bangladesh

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The Central Bank of Bangladesh has made further simplification of the process of Foreign Investment in the country. They have clarified the simplification by their latest publication, FE Circular Letter No. 11, date: 17.05.2021, from Foreign Exchange Policy Department, Bangladesh Bank, Head Office.

 

With this publication, both bankers and foreign investors will be pleased to know that now they do not have any further barriers to open a temporary FDI account through an online application. This policy change will surely ease both the Authorized Dealer (AD) banks in Bangladesh and the potential foreign investors.

 

Simplification of Account Opening Procedures:

 

The Central Bank of Bangladesh has recently allowed banks in Bangladesh to open accounts through online applications. They published a circular letter from their Banking Regulation and Policy Department (BRPD), Head Office on 11.03.2021 (Circular letter no. 16) in this regard.

 

Previously a customer had to physically visit the bank branch to open their account and their necessary documents as per the document checklist. Moreover, after documentation, KYC (Know Your Customer) procedures usually would take several days to complete.

 

With this circular letter from BRPD, banks got an opportunity to tag different web portals, both Government and Service organizations, to acquire customers from everywhere. They were allowed to collect in combination and collaboration with various websites, web portals, and mobile apps of banks or Government service organs.

 

So, banks can use one-stop service facilities and the web portals of BIDA (Bangladesh Investment Development Authority), BEZA (Bangladesh Economic Zones Authority), BEPZA (Bangladesh Export Processing Zones Authority), and Bangladesh Hi-Tech Park Authority.

 

However, the circular letter from BRPD kept the provision for KYC and Transaction Profile procedures the same as before. They also asked banks to collect Sample Signature, known as Authorized Signature, through the online verified channel.

 

A further simplification came with the circular from Foreign Exchange Policy Department’s (FEPD) FE Circular Letter No. 11, 17.05.2021.

 
What is New in the Latest Simplification?

 

The Foreign Exchange Policy Department, Bangladesh Bank (the Central Bank) has clarified the opening of accounts by bank accepting online application. Under this clarification, they have suggested banks in Bangladesh open accounts for Enthusiastic potential investors worldwide.

 

Now, foreign investors worldwide, who are pondering to invest in Bangladesh, can open an account in the name of their proposed company or enterprise from abroad. These investment accounts can be in the form of a Non-Resident Taka Account (NRTA) or Non-Resident Foreign Currency Deposit Account (NFCD) form.

 

Authorized Dealer (AD) banks will follow a simplified process for opening these temporary investment accounts. A foreign investor can apply with minimum documents submitting a name clearance.

 

Investors will, however, complete all other documentation before opening the new regular transaction account. After completing every formality, the Authorized Dealer bank will transfer the balance of the temporary account to the new regular account immediately after the Incorporation of the company or enterprise.

 

Finally, To Wrap it Up:

it is absolutely a good move by the Central Bank of Bangladesh towards the pure digital banking platform. We hope this transformation will help both the investors and all other potential customers. Now, business people may try opening their investment account with any commercial bank of Bangladesh at very ease sitting with their mobile device or laptop on the go.

 

Happy banking!

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