Banking & Finance Law: Foreign Banks and FinTechs in Bangladesh

Regulatory Architecture for Financial Institutions

The banking sector in Bangladesh is primarily governed by the Bank Company Act, 1991 and the Bangladesh Bank Order, 1972. Foreign banks (Scheduled Banks) and FinTech entities (PSOs/PSPs) must navigate a complex web of secondary legislation issued by the Department of Payment Systems (PSD) and the Banking Regulation and Policy Department (BRPD).

Statutory Requirements for Market Entry

Entity Type	Primary Statute	Minimum Capital Requirement	Regulatory Authority
Foreign Scheduled Bank	Bank Company Act 1991, Sec 13	BDT 5,000 Million (approx.)	Bangladesh Bank (BB)
Payment Service Provider (PSP)	PSO & PSP Regulations 2014	BDT 200 Million	BB (Payment Systems Dept)
Payment System Operator (PSO)	PSO & PSP Regulations 2014	BDT 500 Million	BB (Payment Systems Dept)
Non-Bank Financial Inst. (NBFI)	Financial Institutions Act 1993	BDT 1,000 Million	Bangladesh Bank

Licensing Roadmap for Foreign & FinTech Entities

Key Compliance Mandates

Foreign Exchange Compliance: All cross-border transactions must adhere to the Foreign Exchange Regulation Act, 1947. Section 18 prohibits certain payments without general or special permission from Bangladesh Bank.
Anti-Money Laundering (AML): Entities must implement robust KYC and reporting mechanisms as per the Money Laundering Prevention Act, 2012 and Anti-Terrorism Act, 2009.
Data Sovereignty: FinTechs must comply with the Digital Security Act, 2018 and specific BB circulars regarding the localization of financial data within Bangladesh territory.
Taxation: Corporate tax for non-listed banks is governed by the Income Tax Act, 2023, currently set at 40% for non-listed banking companies.

Consult Barrister Liton Asaduzzaman Sarkar

For specialized legal opinions on banking licenses or FinTech regulatory sandboxes, contact our chambers.

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Frequently Asked Questions

What is the legal basis for Bangladesh Bank's authority over foreign banks?

Bangladesh Bank derives its power to license and regulate foreign banks from Section 31 of the Bank Company Act, 1991, and the Bangladesh Bank Order, 1972.

How are FinTech companies categorized under Bangladesh law?

FinTechs are primarily regulated as Payment Service Providers (PSP) or Payment System Operators (PSO) under the 'Bangladesh Payment and Settlement Systems Regulations, 2014', issued pursuant to Section 7A(e) of the Bangladesh Bank Order, 1972.

Are there restrictions on profit repatriation for foreign banks?

Repatriation of profits is permitted under the Foreign Exchange Regulation Act, 1947, provided that the bank has fulfilled its tax obligations under the Income Tax Act, 2023 and maintained the required Capital to Risk-weighted Asset Ratio (CRAR).

◆ Related Statutory Guides & Practice Insights

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  <a href="/en/saas-msa-data-sovereignty-bangladesh-law/" style="color:#C5A059; font-weight:600; text-decoration:none; font-size:14px; display:inline-block; transition:color 0.2s;">&bull; SaaS Master Service Agreements: Data Sovereignty & BD Law</a>
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  <a href="/en/foreign-donations-bangladesh-ngo-fd6-fd7-guide/" style="color:#C5A059; font-weight:600; text-decoration:none; font-size:14px; display:inline-block; transition:color 0.2s;">&bull; Foreign Donations to Bangladesh NGOs: FD-6 & FD-7 Process</a>
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  <a href="/en/foreign-loan-external-borrowing-bangladesh-bank-guidelines/" style="color:#C5A059; font-weight:600; text-decoration:none; font-size:14px; display:inline-block; transition:color 0.2s;">&bull; Foreign Loan and External Borrowing in Bangladesh: BB Guidelines</a>
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Official Regulatory Authorities, Gazettes & Forms

Governing Primary Statutes: Foreign Exchange Regulation Act 1947, Bank Company Act 1991, Guidelines for Foreign Exchange Transactions (GFET)

<div style="margin-bottom:12px; padding-bottom:12px; border-bottom:1px solid #1E293B;">
  <a href="https://www.bb.org.bd/" target="_blank" rel="noopener noreferrer" style="color:#C5A059; font-weight:600; font-size:14px; text-decoration:underline;">Bangladesh Bank (Central Bank) &nearr;</a>
  <p style="color:#94A3B8; font-size:12px; margin:4px 0 0 0; line-height:1.4;">GFET Guidelines, Foreign Exchange Circulars & Authorized Dealer Regulations</p>
</div>

<div style="margin-bottom:12px; padding-bottom:12px; border-bottom:1px solid #1E293B;">
  <a href="https://www.bfiu.org.bd/" target="_blank" rel="noopener noreferrer" style="color:#C5A059; font-weight:600; font-size:14px; text-decoration:underline;">Bangladesh Financial Intelligence Unit (BFIU) &nearr;</a>
  <p style="color:#94A3B8; font-size:12px; margin:4px 0 0 0; line-height:1.4;">Anti-Money Laundering (AML) & Combating Financing of Terrorism (CFT) Directives</p>
</div>

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  <a href="https://btrc.gov.bd/" target="_blank" rel="noopener noreferrer" style="color:#C5A059; font-weight:600; font-size:14px; text-decoration:underline;">Bangladesh Telecommunication Regulatory Commission (BTRC) &nearr;</a>
  <p style="color:#94A3B8; font-size:12px; margin:4px 0 0 0; line-height:1.4;">Payment System Operator (PSO) & Telecommunications Licensing</p>
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