BB scraps licences of 402 money changers since '97

More operating under cover

 Rezaul Karim

More than 400 money changers have got the axe from the central bank since 1997 for breaching the relevant rules and regulations.

The Bangladesh Bank (BB) cancelled the operating licences of 402 money changers (MCs) so far, officials said.

The BB had issued licences for 636 money changers during the period between 1997 and 1999, according to the officials.

Now 234 licensed money changers are operating in the country. Yet the number is much higher than what the market permits, a high official of the BB has said.

The BB scrapped licences of the MCs from 1997 until now, mainly because of breaching the relevant rules and regulations of the BB, according to the central bank sources.

"We remind the MCs about following the directives of the BB repeatedly, if they behave erratically. Ultimately, the central controlling authority cancels the licences of the errant MCs," a source concerned said.

The BB action came as a good number of money changers have been running their business under cover. They are allegedly engaged in endorsement and encashment of foreign currencies defying the central bank's rules.

Under the BB guideline, licensed money changers are allowed to run operations without having any branch. But many of them are conducting business by setting up more than one branch each, violating the BB rules. Operations of the existing genuine exchanges are being hampered seriously because of such illegal operators.

Sector insiders say a number of illegal money changers are there in many areas and more than 50 are doing business without licence at Uttara in the capital.

These illegal exchanges are cent per cent floating in nature and they change their names from time to time. They also play other tricks to escape detection, the sources say.When contacted, a joint director at the Foreign Exchange Policy Department of Bangladesh Bank (BB) said a good number of MCs were not complying with the BB rules. They faced stringent punishment as per rules. Finally, we cancelled their licences."

They engaged in endorsement and encashment of foreign currencies defying the central bank's rules. Besides, they also ran more than one branch each defying the regulator's rules, another official of the BB said.

In September 1999, the BB took a decision not to give permission for setting up any new money changer and issued a circular in this connection.

• Courtesy: Te Financial Express/ May 11, 2018