Dhaka, Bangladesh (BBN) – The central bank of Bangladesh is going to set a limit on the rates offered by the overseas exchange houses of the commercial banks while receiving inward remittances, officials said.

Under the new provisions, the commercial banks will be allowed to offer a rate at maximum of BDT 1.0 less than their rates on bills for collection (BC) to open letters of credit against imports at the customer’s level.

“The central bank has taken the latest measures to encourage inward remittances from the Bangladeshi nationals working abroad through ensuring maximum rate of their hard earned money,” a senior official of the Bangladesh Bank (BB), the country’s central bank, said, adding that the BB will issue directives shortly in this connection.

Besides, the central bank will ask 15 commercial banks, which have overseas exchange house, to monitor such exchange rates closely.

The decision was taken at a meeting with senior officials of 16 commercial banks held at the central bank on Wednesday last with General Manager of the Foreign Exchange Policy Department of the Bangladesh Bank (BB) Ahmed Jamal in the chair, the BB officials added.

The central bank has, so far, given approval to establish 55 exchange houses and set up 870 drawing arrangements abroad to expedite the flow of inward remittances.

The central bank has taken the latest move against the backdrop of unusually high-rate quoted by some commercial banks to the overseas exchange houses to attract more inward remittances.

However, the Bangladeshi expatriates do not receive such exchange rates due mainly to lack of proper supervision and monitoring by the authorities concerned.

BBN/SSR/AD-25Dec11-9:37 am (BST)