Banks cut some service charges
A forum of chief executives of private commercial banks has decided to reduce some service charges in response to demands placed by the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), the apex trade body.
“We sent the revised charge rates to the central bank and all commercial banks on October 1,” said K Mahmood Sattar, chairman of the Association of Bankers Bangladesh (ABB).
Sattar, also the CEO of City Bank, however said ABB could not address all the demands placed by FBCCI.
For instance, he said FBCCI demanded zero charges for LC acceptance for imports, which is impossible for a bank to comply with.
“A bank charges for LC acceptance because it assumes risks. Importers accept their goods and pay the banks even after 120 days, and so high risks are involved,” the ABB chairman told The Daily Star yesterday.
FBCCI sent a proposal to Bangladesh Bank a few months back, demanding it pressurise commercial banks to reduce service charges. Accordingly, BB forwarded the proposal to ABB for consideration.
The association, after consulting matters with its members, sent a recommendation to the central bank. In 2008, private banks reduced charges following a similar demand from the business community.
In the latest proposal, FBCCI demanded discontinuation of charges in 10 areas related to imports, including LC acceptance and handling charges and copy documentation endorsement.
The trade body also demanded discontinuation of commissions, overdue interests and handling charges for export bill negotiations.
FBCCI called for withdrawal of commission and handling charges for export bill collection. It also demanded reducing the rate for Telex/Swift from up to Tk 5,000 to Tk 1,500.
“We reduced the rate in many areas, but we could not address all the demands placed by FBCCI,” said Sattar.
Pubali Bank Managing Director Helal Ahmed Chowdhury said all the banks are trying to reduce several service charges, but they could not do so in all the cases because of declining demand for investment in times of global recession.
Talking to The Daily Star, FBCCI President Annisul Huq said he had submitted the proposal on bank charges to the central bank to create pressure on them to reduce charges, which he said are "very high".
“The central bank told us that they always maintain pressure on banks in this regard,” Huq said.