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June 17, 2020

Bangladesh allows banks to issue international debit cards

Bangladesh Bank (BB), the country’s central bank, has allowed authorised dealer (AD) banks to issue international debit cards (IDCs) to eligible consumers.

Initially, banks in the country were allowed to issue international credit or pre-paid cards (ICC/IPC) to eligible persons against their annual travel entitlements.

The cardholders can use the IDCs for shopping, travel and for paying hotel bills, according to sources.

In a circular, Bangladesh Bank said: “It has been decided that ADs may issue IDCs in favour of eligible persons against their annual travel entitlements.”

However, the issuance of IDCs is subject to relevant instructions under the guidelines for foreign exchange transactions, the central bank added.

According to the circular, the IDCs will be issued according to the cardholder’s annual travel entitlement with endorsement on passports.

The AD banks should have “suitable arrangements” in the local currency accounts to which IDCs are linked.

This is to ensure that the foreign exchange funds beyond the annual limits are not expensed and these accounts should have “sufficient funds to support the expenses to be met from the cards.”

Alternatively, the endorsed amount can be retained in Bangladeshi taka in the “margin accounts to be maintained in the names of customers” to simplify expense adjustments.

Bangladesh Bank added: “Other relevant instructions, with regards to issuance, use and reporting of international cards shall remain unchanged. Please bring the contents of this circular, effective immediately, to the notice of all concerned constituents.”

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