What is Encashment/ Equity Remittence Letter in Bangladesh?

What is Encashment/ Equity Remittence Letter in Bangladesh?

What is Encashment letter ? What is equity investment letter?

Name of Encashment letter, equity investment and equity remittence letter are same that is issued remitting bank in Bank. When foreign shareholders/ investors want to buy shares of the company must pay through TT (telegraphic transfer). Cash deposit in bank by the foreign shareholder for the purpose of equity purchase is not accepted.

Foreign shareholders must transfer money from own account equivalent of share capital in Taka to propose bank account in Bangladesh. Stated that, a temporary or proposed bank account shall be opened by bank in Bangladesh to receive equity investment capital.

How can open proposed bank account?

Foreign shareholder will propose 2-3 business names to check availability in RJSC website App dot Roc Dot Gov Dot Bd. Name approval copy, passport of the shareholder, photograph and some personal detail are required to open a proposed / temporary bank account in Bangladesh.

How long proposed account is valid?

There is no guideline from bank but as it is a temporary account so, validity is limited. After maximum 3-6 months account is closed automatically if no transaction is made.

When account become a regular ?

Well, once remittence is received and issued letter from bank as equity investment the proposed account become regular account. Either same account is converted into regular or a separate account is opened for regular banking.

Which banks are recommended to open temporary account

  • Local City Bank
  • Eastern Bank
  • State Bank of India
  • Standard Chartered Bank
  • Brac bank

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