BB introduces convertible account for NRBs

The central bank has introduced a Non-Resident Convertible Tk Account (NRCTA) facility for Non-Resident Bangladeshis (NRBs) aiming to boost remittance inflows with strengthening investment linkage.

The new account NRCTA -will also help expedite offshore banking operations through Offshore Banking Units (OBUs) of scheduled banks, officials said.

Under the new framework, NRBs will be allowed to open NRCTAs with OBUs in the form of savings, current, or fixed deposit accounts against inward remittances routed through banking channels, according to a notification, issued by the Bangladesh Bank (BB), on Tuesday.

The accounts may also receive funds transferred from other NRCTAs, interest earnings, proceeds from permitted investments, refunds of share subscriptions, and other approved foreign exchange-related inflows, the central bank explained in its notification.

Both principal and accrued interest in NRCTAs will be freely repatriable, according to the notification.

Under the NRCTA facility, the central bank also permits a range of uses, including legitimate local payments, transfers to other non-resident accounts, conversion into foreign currency accounts, and investment in Bangladesh in the form of Foreign Direct Investment (FDI) or portfolio investment.

The officials at the BB, however, said deposits mobilized under NRCTAs may be used by OBUs to extend Taka-denominated financing to Type A industrial enterprises in specialized zones.

Such financing will be usable for admissible current expenditure including wages, salaries, and utility payments, with repayment to be made strictly from export proceeds of the borrowing enterprises, they added.

The central bank also allows Domestic Banking Units (DBUs) of account-maintaining OBUs to extend loans against NRCTA deposits held as lien for NRBs or their nominated parties.

“These loans may be used for personal or business purposes, excluding agriculture, plantation activities, and real estate-related investments,” a BB senior official said while replying to a query.

The central banker also said the proceeds may also support non-repatriable investments in Bangladesh or residential property for self-use, subject to regulatory compliance.