Bangladesh Bank eases rules for IT service exporters

Bangladesh's IT and software firms will now be able to retain an additional ten percent of their export earnings in foreign currency accounts.

The Bangladesh Bank said in a circular on Apr 2 that the exporters may retain up to 70 percent of their income in Exporter's Retention Quota (ERQ) accounts, up from 60 percent.

It said the move was to 'promote export of IT services.'

The central bank has also raised the annual limit for IT firms of the fund they can send abroad to meet expenses. It has been increased to $30,000 from $25,000.

Banks have been told that they can now issue international cards to exporters for $6,000 instead of $2,500, which can refilled upon availability of the limit.

Issuing debit, credit or pre-paid cards to individual developers and freelancers with an annual limit of $300 have been also given the green light in a separate circular.

The Bangladesh Bank has also introduced a separate declaration form for inward remittances amounting more than $10,000. IT firms do not require a declaration for receiving remittances within the limit.

In a circular, the central bank said that the move was aimed to keep track of the 'fast growing' IT sector's income.

"Accuracy in recording income of this sector for external sources is required to project future needs," it read.

The Bangladesh Bank advised all commercial banks to 'extend all-out cooperation' to exporters regarding inward remittances.