Banking
Treasury Chalan to go online in June
Bangladesh Bank (BB) is working on introducing online Treasury Chalan Submission and Verification System in June this year.
A senior BB official told BSS that they are implementing a central bank strengthening project with assistance from the World Bank (WB), under which an e-payment gateway will also be introduced in six months time.
Finance Division of the Ministry of Finance and Access to Information (A2I) Programme of Prime Minister’s Office (PMO) are also working to implement the programme to solve the problem related to the existing manual procedure of submitting the Chalan.
“The e-payment gateway will facilitate all types of online payment including the payments through the Treasury Chalan,” BB Executive Director M Abdul Hamid said.
People require paying taxes or fees to the Treasury through Chalan (a prescribed form) for getting various services from the government. The current process of submitting the Chalan is seen cumbersome, time consuming and prone to malpractices.
The Daily Sun/Bangladesh/ 15th Jan 2012
Bankers urged to lead economy
Bangladesh Bank Governor Dr. Atiur Rahman on Saturday urged the high officials of the central bank to lead the economy for the betterment of the country.
He urged the senior officials of the central bank for attaining adequate communication skills so that they could disseminate complex economic information to the stakeholders.
The governor was addressing the closing session of a two-day Strategic Planning Workshop 2012.
The Strategic Planning Unit of Bangladesh Bank organised the workshop that started on Friday at BRAC CDM, Savar, Dhaka.
The workshop was organised to strengthen leadership quality of the officials of the BB. All BB officials in the rank of General Manager and above attended the workshop.
Deputy Governor Abul Qasem, executive director Md Ahsanullah, senior advisor to the governor Allah Malik Kazemi, Khandkar Ibrahim Khaled, Chairman, Bangladesh Krishi Bank, renowned cultural personality Aly Zaker, among others, addressed the workshop at different sessions.
Ibrahim Khaled led a session on leadership on the first day while Aly Zaker led a session on Communication Skill Development on the second day of the workshop.
The contemporary issues of core inflation (other than food and fuel), interest rate and exchange rate were discussed in the workshop. The workshop opined that these are inter-related and are highly influenced by the external events as well.
The workshop also finalised the future action plan in order to achieve the objectives of Strategic Plan 2010-2014.
The Daily Sun/Bangladesh/ 15th Jan 2012
SME loans bypass area of focus
Two-thirds of loans given to small and medium enterprises are used in trading, which analysts say is a threat to sustainable economic growth.
Nearly Tk 25,000 crore or 65 percent of SME loans disbursed in January-September of 2011 went into trading, 29 percent into manufacturing and the rest into the services sector, according to data from Bangladesh Bank.
“The SMEs are meant for production. If the loans are not used for manufacturing, the core objective will not be achieved,” said Mustafa K Mujeri, director general of Bangladesh Institute of Development Studies.
Mujeri, a former chief economist of Bangladesh Bank, said the central bank should identify the causes and remedies, so that SMEs can flourish.
Bankers and SME businessmen blamed the rise in cost of funds, low productivity, and a lack of skilled manpower and policy support from the government for the situation.
Regulatory permissions, such as environmental clearance for a manufacturing unit, also discourage entrepreneurs.
“The rising interest rate is pushing production costs up,” said Dewan Ali Kabir, who manufactures printing paper used to print utility bills.
Kabir borrowed money initially at 12.5 percent. Months later, the bank reset it at 14 percent and now, they are asking for 18 percent, he said.
That is not the only bad news for Kabir. As he imports raw materials, the devaluation of the taka is eating up his profits.
Nessar Maksud Khan, who runs a group of small and medium companies, said the high costs of production are discouraging SMEs from manufacturing.
“I used to outsource plastic products from the local market for corporate supplies. Later, I found it cheaper to import,” said Khan, also a director of Dhaka Chamber of Commerce and Industry.
Though business becomes easier for a bank if it funds trading activities, the country is missing out on the much needed transformation to manufacturing and industrialisation. SMEs contribute significantly towards industrial output, exports and employment generation for the economic growth of any country.
“Repayment of the manufacturing sector is not very good. Moreover, it is exposed to a lot of external factors, such as a supply of energy, import of raw materials and the exchange rate,” said a senior manager of BRAC Bank.
For bankers, he said, trading is easy to understand and less risky to finance.
“Banks play a helping role for traders, but they must be drivers for the manufacturing concerns,” said the BRAC Bank official.
An Eastern Bank official concerned with the SME division pointed at vested quarters, who import goods by dodging taxes, as a threat to the local SME manufacturers. He also said regulatory requirements, such as getting permission from the environment department for any manufacturing enterprise, are time consuming.
“It takes at least six months to get the required permission from the department of environment, which discourages both borrowers and lenders,” the official said.
Bankers found SMEs weak in managing business -- from planning to purchasing, design, production, quality control, marketing, finance, human resources, public relations, new business developments and target growth.
Due to their small size, SMEs cannot afford to appoint qualified fulltime financial executives to manage their activities, and interact with the bankers and regulatory agencies, they said.
The Daily Star/Bangladesh/ 15th Jan 2012
BB to take action against illegal forex trading
Bangladesh Bank (BB) has moved to take legal action against the persons and the institutions that are offering people illegal currency trading through internet and electronic trading portals.
In a statement last week, the central bank advised people not to involve in this illegal business and warned them of stern consequences for such activities.
The BB referred to some recent advertisements in the media that offered people training for earning high returns from online foreign exchange trading and dealing.
The BB said these advertisements also offered currency loading facility in debit cards to run the online foreign currency exchange business by taking the 'risks' of the 'daily fluctuation of exchange rates'.
The trading of its kind by unauthorised people and organisations is illegal. The Foreign Exchange Regulation Act allows only licensed dealers and money exchangers to run such business.
It advised people to refrain from responding to such tempting, but illegal offers and warned respective advertisers of punitive actions.
Most web-based foreign exchange transactions are carried out on a margining basis with huge leverage or on an investment basis, where the returns are based on currency trading, a BB official told the news agency.
People are advised to make the margin payment for these transactions through their credit or debit cards, which are not only illegal, but also involve high risk of losing their total credit or debit limit to unknown people.
The Reserve Bank of India (RBI) in April last year issued similar warning against such business and cautioned people of the financial and legal risks of these activities.
The Daily Star/Bangladesh/ 15th Jan 2012
Dutch-Bangla Bank builds bridge at Kurigram
Sayem Ahmed, chairman, executive committee of the board of Dutch-Bangla Bank Limited (DBBL), inaugurated the ‘Dutch-Bangla Bank Bridge’ in Kurigram by unveiling a plaque on Friday.
The bridge links road from Chatlakanda to Tura via Shoulmari Rowmari upazilla, will ease sufferings of the rural people and boost business activities under Kurigram district, says a press release.Fakrul Islam, director of DBBL, and Md Yeasin Ali, former managing director of DBBL, were also present.
Rowmari upazilla situated in the North-East frontier point of the country surrounded by Brahmaputra and Zinzirum rivers drew the attention of the Bank and after conducting a field survey, a bridge (144 ft.) at a cost of Tk 6.1 million has been constructed under the supervision of the bank.
Md Zakir Hossain, MP, Sheikh Mohammad Abdul Khaleque, chairman, Rowmari upazilla, Mizanur Rahman Minu, union parishad chairman, were present, among others.KS Tabrez, managing director, and Abul Kashem Md. Shirin, deputy managing director of DBBL, were also present.
The Daily Independent/Bangladesh/ 15th Jan 2012