Bangladesh Bank allows foreign currency deposits as security bonds for embassies

Commercial banks can now issue virtual or international cards for visa-related forex guarantees

Bangladesh Bank has allowed customers to place foreign currency security bonds with embassies of different countries as a precondition for obtaining visas.

Commercial banks will be able to issue international or virtual cards against customers for this purpose, the central bank said on Monday.

Existing cardholders will also be eligible for the facility.

According to the notification sent to commercial banks, authorised dealer (AD) branches will now be allowed to allocate foreign currency for embassies or international authorities that require refundable security deposits in foreign currency as a condition for issuing visas.

Only funds that are refundable or repatriable to Bangladesh after expiry of the term can be kept as security deposits in foreign currency.

Banks have been instructed to bring back the foreign currency after the security period ends.

Before allocating foreign currency, banks must verify embassy letters and other necessary supporting documents, the central bank said.

The notification said foreign currency under the facility can only be used for visa-related purposes.

Banks must preserve valid passports and all relevant documents issued by the concerned authorities.

The foreign currency security deposits can also be made using funds from ERQ accounts, maintained under exporters’ retention quota facilities, or from RFCD accounts held by Bangladeshi residents.

As a result, embassies based in Dhaka will now be able to take foreign currency guarantees or security deposits from travellers going abroad for studies, workshops or other purposes.

The security deposit money will be returned to Bangladesh after the expiry of the term.