Inward foreign remittance activities in sibl

1. Presented by:
Md. Akmal Hossain
Senior Vice President
International Division
INWARD FOREIGN REMITTANCE
ACTIVITIES in SIBL

2. Remittance
A remittance is a transfer of money by a foreign worker to an individual in his
or her home country.
Beneficiary Remitter
Request for Remittance
Remitting Bank
Instruction to Transfer amount
Beneficiary Bank
Amount Credited
to customer
a/c post purpose
of
remittance/Cash

3. Inward remittance facilities in Bangladesh
• Bangladesh Bank permits banks in Bangladesh to establish drawing
arrangements with Foreign banks and Exchange houses for facilitating
remittance by Bangladeshi nationals living abroad.
• Persons willing to remit their earnings through official channels can buy
either Taka draft or US dollar draft from these Foreign banks and Exchange
houses having drawing arrangements with different banks in Bangladesh.
• Bangladeshi nationals living abroad can send Foreign Exchange very easily
and directly to their own bank accounts maintained in Bangladesh or to
their nominated person's / relative's bank accounts in Bangladesh.
• Recently banks have taken some major steps towards crediting the
proceeds of remittances to the beneficiary's account promptly, maximum
by 3(three) days.

4. Foreign Remittance Transfer Mode
Spot cash: Money paid upon PIN number Presentation @ counter.
Bank Transfer: a way to send money from an account at one bank to an
account at another bank located anywhere in the world.
(1) Bangladesh Electronic Fund Transfer Network (BEFTN): In BD banks
has arrangement for account payment at any branch of any bank in
Bangladesh through Bangladesh Electronic Fund Transfer Network
(BEFTN)
(2)Account Credit to own Bank:
Online Credit if Central Accounts System exists :
- SIBL account credit transaction are posted by CRPU department.
Most Private banks has the same facility. State-owned banks & some first
generation banks are yet to develop central Accounts Settlement systems

5. It is a multilateral electronic clearing system in which electronic payment
instructions will be exchanged among Scheduled Banks.
The system involves transmitting, reconciling and calculating the net position
of each individual participant at the end of each processing cycle. The
participants involved are:
(a) Originator.
(b) Originating Bank (OB)
(c) Bangladesh Electronic Funds Transfer Network (EFT Operator)
(d) Receiving Bank (RB)
(e) Receiver
(f) Correspondent Bank
5
Electronic Fund Transfer Network (EFTN)

6. EFTN Process
6

7. NOSTRO, VOSTRO, LORO Accounts
NOSTRO Account
Italian word 'nostro' means 'ours'. Hence, Nostro account points at - "Our account
with you"
Nostro accounts are generally held in a foreign country (with a foreign bank), by
a domestic bank (from our perspective, our bank). This account is maintained in
that foreign currency.
For example, SIBL is having an Nostro account with SCB in New York.
VOSTRO Account
Italian word 'vostro' means 'yours'. Hence, Vostro account points at - "Your account
with us"
Vostro accounts are generally held by a foreign bank in our country (with a domestic
bank). It generally maintained in local currency, BDT.
For example, SCB account is held with SIBL in Bangladesh.

8. LORO Account
Again, Italian word 'loro' means 'theirs'. Therefore, it points at - "Their account with
them“
Loro accounts are generally held by a 3rd party bank, other than the account
maintaining bank or with whom account is maintained.
For example, NRB Bank wants to transact with SCB, but doesn't have any account,
while SIBL maintains an account with SCB, NY. Then NRB Bank could use SIBL account.
NOSTRO, VOSTRO, LORO Accounts-Cont.

9. Importance of Remittance for banks
Core source of Fund for Foreign Exchange business:
-Import Payments
-Transfer Payment of any fees, charges, services in Foreign currency
-LC Settlements between Banks
-Issuance of credit card / FC Loan

10. Foreign Remittance Scenario of SIBL
Past Achievements & Projection of Remittance 2018
Year 2013 2014 2015 2016 2017 2018(E)
No. of Exchange
Company
14 15 19 23 25 28
Amount Received in
USD [mill]
33.60 103.30 124.94 160.00 273.00 340.00
Growth in USD
(Million)
64.82% 207.44% 21.65% 30.00% 40% 25%

11. Industry Position of SIBL in Remittance Business
• In 2016, with Remittance fund of 160 Million USD SIBL
secured 11th position in Remittance earnings among the 57
banks currently operating under BB.
• Islami Bank Bangladesh Limited stood 1st with remittance of
over 1000 Million USD, followed by the State owned banks like
Agarni, Janata, Sonali regularly receiving over 50 million USD
each.

12. Migrant remittance inflows (US$ million)
SL No. Country 2016
1 India 62,744
2 China 61,000
3 Philippines 31,145
4 Mexico 28,670
5 France 24,373
6 Nigeria 20,112
7 Pakistan 19,761
8 Germany 16,683
9 Egypt, Arab Rep. 16,590
10 Bangladesh 13,559
11 Vietnam 11,880
12 Spain 10,281
13 Belgium 9,867
14 Italy 9,713
15 Indonesia 8,977
16 Lebanon 7,616
17 Guatemala 7,469
18 Sri Lanka 7,257
19 Morocco 7,088
20 Poland 6,712
Source: World Bank Data

13. Year/Month
Remittances Year Wise Figure
In million US dollar In billion Taka
2017-2018* 6935.72 562.62
2016-2017 12769.45 1010.99
2015-2016 14931.18 1168.57
2014-2015 15316.91 1189.93
2013-2014 14228.26 1105.84
2012-2013 14461.14 1156.47
2011-2012 12843.43 1018.82
2010-2011 11650.32 829.91
2009-2010 10987.40 760.11
2008-2009 9689.26 666.77
2007-2008 7914.78 542.96
2006-2007 5998.47 413.01
2005-2006 4802.41 322.76
2004-2005 3848.29 236.48
2003-2004 3371.97 198.7
2002-2003 3061.97 177.29
2001-2002 2501.13 143.77
2000-2001 1882.1 101.7
1999-2000 1949.32 98.07
1998-1999 1705.74 81.98
1997-1998 1525.43 69.35
1996-1997 1475.42 63
1995-1996 1217.06 49.7
1994-1995 1197.63 48.14
1993-1994 1088.72 43.55
1992-1993 944.57 36.97
1991-1992 849.66 32.41
1990-1991 763.91 27.26
Source: Bangladesh Bank

14. USD in millions
Country 2013-2014 2014-2015 2015-2016 2016-2017
July August
Septembe
r
October November December
Total
2017-2018 2017-2018 2017-2018 2017-2018 2017-2018 2017-2018
Bahrain 459.39 554.34 489.99 437.14 40.68 52.17 30.86 43.37 42.57 41.42 251.07
Kuwait 1106.88 1077.78 1039.95 1033.31 88.41 99.66 62.61 90.32 90.94 95.26 527.2
Oman 701.08 915.26 909.65 897.71 75.74 96.11 57.93 77.79 74.49 68.93 450.99
Qatar 257.53 310.15 435.61 576.02 61.16 65.62 37.3 50.81 61.69 61.59 338.17
K.S.A. 3118.88 3345.23 2955.55 2267.22 199.4 249.62 142.97 210.35 194.77 205.22 1202.33
U.A.E. 2684.86 2823.77 2711.74 2093.54 169.95 210.83 133.92 191.06 212.7 219.9 1138.36
Libya 71.96 45.72 12.34 2.23 0.05 0.19 0.1 0.15 0.19 0.19 0.87
Iran 0.4 0.14 0.17 0.01 0 0 0 0 0 0 0
Sub total 8400.98 9072.39 8555 7307.18 635.39 774.2 465.69 663.85 677.35 692.51 3908.99
Australia 54.38 61.84 69.15 52.03 4.45 6.19 3.86 3.89 4.27 4.61 27.27
Hongkong 17.7 19.68 25.65 18.98 1.64 1.98 1.12 1.9 1.2 2.07 9.91
Italy 269.59 260.16 351.31 510.78 60.23 80.19 41.81 53.64 57 48.88 341.75
Malaysia 1064.68 1381.53 1337.14 1103.62 73.08 102.56 63.53 89.31 89.16 86.99 504.63
Singapore 429.11 443.44 387.24 300.99 27.35 27.58 18.31 23.37 24.39 24.93 145.93
U.K. 901.23 812.34 863.28 808.16 80.2 117.9 59.88 73.79 93 74.02 498.79
U.S.A. 2323.32 2380.19 2424.32 1688.86 146.58 199.08 135.48 167.26 176.91 137.05 962.36
Germany 26.94 21.16 25.89 31.75 2.39 3.33 2.33 3.18 4.11 2.95 18.29
Japan 17.06 16.3 22.09 22.92 1.81 3.08 1.46 2.17 2.51 2.57 13.6
S.Korea 58.58 60.38 64.78 80.65 7.56 7.82 6.33 7.48 9.5 7.24 45.93
Others 664.75 787.49 805.33 843.53 74.89 94.67 57.07 72.93 75.35 83.36 458.27
Sub total 5827.34 6244.51 6376.18 5462.27 480.18 644.38 391.18 498.92 537.4 474.67 3026.73
Total 14228.32 15316.9 14931.18 12769.45 1115.57 1418.58 856.87 1162.77 1214.75 1167.18 6935.72
Wage Earners Remittance inflows: Country wise(Monthly)
Source: Bangladesh Bank

15. 15
List of Exchange Houses
Sl. No.
Name of the Money Transfer Company/ Remittance
Exchange House
Remittance Source Countries
1 Western Union Money Transfer Global
2 Xpress Money Services Global
3 MoneyGram Global
4 Placid NK Corporation USA, Malaysia, Italy, Spain
5 Asia Express Exchange Oman
6 Purshottam Kanji Exchange Oman
7 Doha Exchange Qatar
8 Oman & UAE Exchange Oman
9 Aussie Forex & Finance Pty. Ltd. Australia
10 UAE Exchange Center Malaysia
11 Intel Express Georgia Ltd Georgia
12 Lotus Forex Hong Kong
13 KEB (KEB HANA BANK) Korea
14 Zenj Exchange Co Bahrain
15 Paypal / Xoom Corporation USA
16 TransFast Remittance LLC
Middle East, Europe, America & Rest part of the
World
17
LCC TRAN-SENDING LTD. (Also known as Small World
Financial Services)
UK, USA
18 United Bank Limited UK
19 International Remittance SINGAPORE
20 INSTANT CASH UAE
21 Global Money Exchange OMAN
22 Ria Financial Services Global
23 Al Mirqab Exchange Qatar
24 Index Exchange (Former Habib Exchange) UAE
25 National Exchange Company Italy
26 Sha Global UK

16. FAQ
• No person, firm or company other than an AD or Authorized Money Changer is
permitted to deal in foreign currency in any form
• Remittances equivalent to US$ 10000 and above should be reported on Form C.
• Declaration on Form C by the beneficiary is not required against remittances
sent by Bangladesh nationals working abroad.
• The purpose of remittances should be clearly stated on the Form C.
• Remittances received against exports should be certified and reported on EXP
Forms
• An incoming person may retain foreign exchange upto US$ 5000 or equivalent
brought in by himself/herself without declaration and take out the same at the
time of departure from Bangladesh without endorsement in passport and air
ticket. Such amounts may also be deposited in RFCD account by a resident
Bangladeshi and in NFCD account/private non-resident FC account by a non-
resident Bangladeshi any time after arrival in Bangladesh

17. FAQ-Cont.
• Amount in excess of USD 5000, brought in by the resident Bangladeshis, should
however be encashed or deposited in appropriate foreign currency account
within 30 days of arrival. Such amounts brought in by non-resident Bangladeshis
can be encashed or deposited in foreign currency account any time after return
to Bangladesh. For a foreign national, the entire amount brought in with
declaration on Form FMJ or upto USD 5000 brought in without declaration may
be taken out freely at the time of departure.
• ADs must exercise utmost caution to ensure that foreign currencies remitted or
released by them are used only for the purposes for which they are released;
they should also maintain proper records for submission of returns to
Bangladesh Bank as also for the latter's inspection from time to time.
• The maximum time limit for distributing remittances to the beneficiaries has
been decreased to 2 working days from 72 hours for augmenting remittance
distribution under the drawing system of the bank.

18. FAQ-Cont.
• Release of foreign exchange in excess of USD 200 or equivalent will require valid visa.
• The ADs may release foreign exchange upto US$ 1000 or equivalent per person during a
calendar year to Bangladesh nationals proceeding by air to destinations in SAARC member
countries and Myanmar; within this annual limit, up to US$ 500 or equivalent may be
issued per person for overland travels to the aforesaid countries.
• Also for visits of Bangladesh nationals to destinations in countries other than SAARC
member countries and Myanmar, upto US$ 3000 per person may be issued during a
calendar year.
• However, foreign exchange in the form of cash must not exceed US$ 2000 at any one
instance
• Up to US$ 10,000 or equivalent may be released by the AD on the basis of the
recommendation of the Medical Board set up by the Health Directorate or on the basis of
the need established through recommendation of appropriate medical specialists and the
cost estimate of the foreign medical institution.
• Request for release of foreign exchange exceeding US$ 10,000 for treatment abroad
should be forwarded by the AD with supporting documents to Bangladesh Bank (Foreign
Exchange Operation Department) which will authorize release upon verification of the
bonafides of the expenses.

19. Organizations contributing towards Foreign
Remittance development
• Foreign Ministry of Bangladesh
• Bangladesh Association of International Recruiting Agencies (BAIRA)
• Bangladesh Overseas Employment and Services Limited (BOESL)
• Wage Earners’ Welfare Board(WEWB)
• Ministry of Foreign Employment Promotion and Welfare, Bangladesh
• Human Resource Development Bureau
• Bangladesh Bank

20. THANK YOU
Any Question?