BB allows international cards for overseas education payments

Bangladesh Bank has allowed the use of designated international cards to pay tuition fees and other education-related expenses for Bangladeshi students studying abroad.

According to a circular issued by the central bank on Monday, authorised dealers (ADs) can now issue or permit the use of international cards for legitimate payments by students enrolled in regular courses at recognised foreign educational institutions.

The facility will cover undergraduate and postgraduate programmes, language courses, and professional diploma or certificate programmes.

Bangladesh Bank said the decision was taken to facilitate payments to overseas educational institutions and service providers, which increasingly require tuition, enrolment and other education-related fees to be paid through international cards and online platforms.

Under the new arrangement, overseas education-related transactions will be treated separately and will not be counted against the existing travel quota or other foreign exchange entitlements.

ADs may issue debit, prepaid or credit cards for this purpose. For credit cards, the applicable limits will be determined by the issuing bank's internal policy, subject to the limits prescribed by Bangladesh Bank.

The circular said cards may be issued either in the name of the student or the person who bears the student's educational expenses.

Before permitting such transactions, banks must complete all necessary regulatory formalities, including Know Your Customer (KYC) and Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) requirements.

Bangladesh Bank instructed ADs to establish appropriate controls to ensure that payments are made only to eligible beneficiaries and remain within the loaded amount and the card's validity period.

All transactions under the facility must be reported to Bangladesh Bank through the TM Module using the appropriate purpose codes.

The central bank also said all other existing instructions governing foreign exchange transactions for overseas education will remain unchanged.