Economy
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"PayPal set to arrive in Bangladesh" PayPal's arrival in Bangladesh will pave the way for hassle-free electronic transfers of money, increase access to foreign consumers and ease the influx of remittances and earnings from foreign companies. After much back and forth over the past two years, PayPal is finally gearing up to launch in Bangladesh by the end of April. “We just received the permission today [Monday]. Now we will go forward with the necessary procedures, including the signing of a formal agreement with PayPal, so that the service comes into operation soon,” a highly placed source at Foreign Remittance Management Division of Sonali Bank told the Dhaka Tribune. According to another official source, all necessary processes, including the cross-checking of documents, legal compliance and the finalisation of terms and conditions have been completed. A tripartite deal among Bangladesh Bank, Sonali Bank and PayPal will be signed soon. Once the agreement is signed, the IT division of Sonali Bank will complete all necessary IT-related tasks, including the type of account to be used and AML/CFT (Anti-Money Laundering/Combating the Financing of Terrorism) compliance status. Sonali Bank Managing Director and Chief Executive Officer Md Obayed Ullah Al Masud and Bangladesh Bank’s Deputy Governor Abu Hena Mohd Razee Hassan were, however, not available for comment. Earlier in July 2016, Sonali Bank and PayPal signed a draft Memorandum of Understanding (MoU), which had been sent to PayPal for approval. Since its start in December 1998, PayPal has enabled nearly 200 million individuals and businesses to transfer funds electronically. PayPal, which is available in more than 200 markets around the world, enables its account holders to receive money in more than 100 currencies, withdraw funds in 56 currencies and hold PayPal account balances in 25 currencies. Its presence in Bangladesh will now provide a hassle-free electronic channel for the transfer of money from one country to another, the influx of remittances and earnings from foreign companies and increase access to foreign consumers. “Most Bangladeshi freelancers cannot bring their hard-earned money in through the proper channels due to a lack of a trusted and government-approved payment gateway,” BASIS President Mostafa Jabber told the Dhaka Tribune. Currently, there are about 550,000 freelancers and about 700 e-commerce websites in Bangladesh. At present, these local freelancers use middlemen to bring in their foreign income, a move which is both risky and comes at a high cost. Their income is also considered part of the inflow of remittances. With PayPal in the country, this will no longer be an issue. Not only will it be easier and safer for freelancers to collect payments from foreign clients, but their incomes will now also be considered separate from remittances. “I welcome PayPal’s entry in Bangladesh as this will highly benefit the country’s freelancers who have trouble bringing in their earnings safely,” said Shamim Ahsan, former president of Bangladesh Association of Software and Information Services (BASIS). Bangladesh has also been facing much difficulty in receiving remittance earned through outsourcing, and this new contract with PayPal will make the remittance inflow both easier and faster. E-commerce entrepreneurs can now also look beyond the country’s borders and connect with the foreign market, effectively pushing Bangladesh into the global shared economy. “PayPal is the most secure and the best payment gateway for monetary transactions. PayPal in Bangladesh will help e-commerce entrepreneurs to connect with more consumers from foreign countries,” said Ataur Rahman, co-founder of amardeshamargram.com, an e-commerce business. Razib Ahmed, president of e-Commerce Association of Bangladesh (e-CAB), said PayPal would help the entrepreneurs to expand their businesses by ensuring that they are easily able to receive payments for work both at home and abroad. This move is a part of the government’s vision to establish a resourceful and modern country through the effective use of information and communication technology by 2021. "Sonali Bank gets Bangladesh Bank nod to start PayPal services" Bangladesh Bank has permitted state-owned Sonali Bank to launch the online money-transfer services with PayPal in the country. “The much-awaited PayPal services will soon be introduced in Bangladesh now after the clearance,” Sonali Bank General Manager and Chief Information Officer Mofazzal Hossain hopes. PayPal is an e-commerce firm, which provides electronic alternatives to traditional paper methods like cheques and money orders. The service is very popular among online shoppers and outsourcing experts. Mofazzal told bdnews24.com that the bank's managing director received the permission letter on Monday to introduce PayPal services in Bangladesh. Sonali Bank earlier struck a deal with the global online money transfer giant on the matter, Mofazzal said. "We have succeeded after long discussions. We sent a proposal to sign a memorandum of understanding (MoU) to the PayPal last year. We started to act when they replied positively. Now, the entire process is finished as the Bangladesh Bank has given the clearance," he said. He also said the Sonali Bank MD held a meeting with PayPal officials last week. "Now we hope we will soon be able to launch the services," he added. State Minister for ICT Zunaid Ahmed Palak told bdnews24.com earlier: "We have advanced much in our efforts under the leadership and supervision of prime minister's ICT affairs adviser Sajeeb Wazed Joy to introduce PayPal services in Bangladesh. I hope we will be able to give the freelancers and others the good news very soon." The launching of PayPal services has been the subject of discussion in Bangladesh since 2011. Palak met a vice president of PayPal during his US visit in 2015. The minister said at the time that they had discussed the strategic aspects of including Bangladesh's name on the list of countries where the company has its operations. An electronic debit or credit card issued against a bank account is needed to open a PayPal account. A PayPal account holder can ask the PayPal authorities for cheques, or spend money on the account, or submit money to a bank account affiliated with his or her PayPal account.

Ishtiaq Hossain

May 15, 2017


Bangladesh


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