On Wednesday (July 29), the Foreign Exchange Policy Department of Bangladesh Bank issued a notification in this regard.

According to the new directive, the country's banks will be able to launch such services in the country through agreements with foreign digital payment service providers, online payment gateways, and other legitimate international transaction service providers. As a result, the opportunity to launch services of international platforms like PayPal and Payoneer has been created in the future.

Bangladesh Bank has said that this initiative has been taken to facilitate international service-oriented trade, increase digital financial inclusion, and modernize the foreign exchange transaction system.

How the new system will work

According to the directive, banks will be able to assist customers in opening digital wallets or stored-value accounts called Digital Value Account (DVA). However, these accounts will not be operated directly; each account will be linked to a Master DVA or settlement account of the respective bank.

To ensure transparency of transactions, banks must maintain real-time monitoring systems and keep parallel accounts. Unused funds will remain under the bank's control and must be adjusted or refunded as needed.

Purposes for which it can be used

Under the new system, individuals, businesses, and freelancers will be able to conduct various types of transactions in foreign currency.

Through this facility—

• Personal, medical, and official foreign travel expenses can be paid.
• For international online shopping or various fee payments, a maximum of 300 US dollars can be used per transaction.
• Membership fees, IT-related expenses, visa processing fees, and online hotel booking payments can be made.

Benefits for exporters and freelancers

Export Retention Quota (ERQ) and Resident Foreign Currency Deposit (RFCD) account holders will also get this facility.

In the case of ERQ account holder institutions, up to three top officials can use DVA for business expenses. Additionally, freelancers and e-commerce entrepreneurs will be able to easily bring their earnings from international platforms into the country.

Benefits for foreign tourists as well

Foreign citizens and tourists arriving in Bangladesh will also be able to use this settlement facility for digital payments at local merchant points.

Bangladesh Bank's conditions

Bangladesh Bank has said that before launching this service, the concerned banks must obtain prior approval from the central bank's Foreign Exchange Policy Department by providing detailed information on their technical capacity, security measures, and procedures.

In addition, to prevent money laundering, customer identification (KYC), and other regulatory directives must be followed, and regular transaction information must be submitted to Bangladesh Bank.