Online buys with int’l cards tightened

Staff Correspondent | Published: 00:00, Nov 15,2019

 
 

MasterCard and VISA credit cards are seen in this picture illustration. The Bangladesh Bank on Thursday tightened its rules regarding online payment against purchase of goods and services from aboard using international cards. —Reuters photo

The Bangladesh Bank on Thursday tightened its rules regarding online payment against purchase of goods and services from aboard using international cards by imposing a number of conditions like taking prior approval from banks concerned for such transactions.

The central bank tightened the rules as it came to know about misuse of international cards even for money laundering, an official of the BB told New Age, adding that the international transactions using international cards would remain blocked until the due procedure is followed.

However, the tightened rules would not be applicable to the purchase of goods and services in local currency, a BB official told New Age.

Under the new requirement, international cardholders will have to submit online transaction authorisation form (OTAF) to the banks concerned to activate international payment option.

In the form, cardholders will have to specify payment detail, a BB circular issued on Thursday said.

The authorised dealers of the banks would then verify whether the payment is legitimate or illegitimate in line with the BB’s Guidelines on Foreign Exchange Transaction-2018.

The BB advised the card issuing banks to follow extended due diligence in ensuring legitimacy of any transaction to check misuses.

Under the guidelines, capital account transactions, payment for casino or gambling, forex trading, purchasing financial instruments issued on foreign stock markets, cryptocurrency and lottery tickets are among the prohibited items.

According to the BB circular, once the authorised dealers of the banks are satisfied with the transaction detail specified in the OTAF, the dealers will be allowed to activate the client’s international card for an international transaction.

The BB also asked the ADs to block again international card immediately after the transaction execution.

The ADs have been asked to verify the executed online transaction with the declaration made by the customer and satisfy themselves regarding payment of applicable VAT, tax and duty for online purchase of goods and services from abroad through international card.

Besides, the BB also instructed the banks not to allow their customers executing any transaction against purchase of goods and services originated and sold in Bangladesh by using international cards. Instead, such local transaction should be executed by using local cards which are meant for local payment.

At present, the banks are allowed to facilitate their customers’ payment up to $300 per transaction abroad by using international cards for the purchase of goods and services.

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