Wednesday, 1 February, 2023

Small traders don’t need to show trade licences for opening bank accounts: BB

Bangladesh Bank has waived the provision of showing trade licenses in opening bank accounts by small traders, according to a recent circular of the bank.

The name of the account will be 'Personal Retail Account' or 'Private Retail Account'. This account can be opened in banks, mobile financial services (MFS), e-wallet service providers, and payment service providers (PSP).

Small entrepreneurs can transact through such an account for commercial purposes, said the circular, reports UNB.

A personal retail account can be opened only after submitting the documents required for e-KYC in bank account opening. There is no cost to open this account. Besides, the loan will also be available on the basis of the transactions. Even if the account is in MFS, the cash-out cost will be less.

The Director of the Payment System Department of BB Masbaul Haque told UNB that there is an opportunity to open a 'personal retail account' without a trade license.

The central bank has issued such a directive to create a scope for the growth of the small business sector.

According to the central bank's circular, no trade license will be required to open an 'individual retail account'.

E-KYC and necessary documents to open a bank account have to be submitted. It will be managed like a current account. This account can be used for commercial purposes, BB sources said.

However, a maximum of Tk10 lakh per month can be transacted through this account. The one-time status of this account will be maximum Tk 5 lakh.

Micro and small traders such as grocers, floating food vendors, bus-CNG-rickshaw drivers, street vendors, sellers of various products and services on Facebook, or service providers engaged in various marginal professions can open this account.

A copy of the national identity card and proof of profession are required to open the account. The trade license is not mandatory for professional credentials. A valid document issued by the local public representative or the relevant business association is required. All banks, MFS, and PSP service providers in the country will open this account free of cost, said BB.