The Bangladesh Bank has granted permission for licensed payment service providers (PSPs) to facilitate inward wage remittances in an effort to boost remittance inflow. This decision comes as the country’s foreign exchange reserves have been declining due to slower forex earnings and increased demand for imports. Licensed PSPs are now allowed to repatriate wage earners’ remittances in collaboration with internationally recognized online payment gateway service providers, banks, digital wallets, card schemes, and foreign PSPs.
This move aims to provide more flexibility in earning remittances. PSPs will need arrangements with foreign PSPs to receive foreign currency in their accounts, with an equivalent value credited to wage earners’ PSP accounts. Subsequently, foreign PSPs will credit the designated authorized dealers’ banks’ nostro accounts. Wage earners can then use PSP accounts abroad for all transactions in the local currency. Currently, there are eight PSPs operating in the market, and last year, mobile financial service providers were also allowed to bring in wage earners’ remittances to Bangladesh.
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