Term Paper on Foreign Exchange Function of Different Institutions

Commercial Bank,  Money Exchanger & Ready-Made Garments Factory

Bank plays an important role in the business sectors and in the industrialization of a country. Basically the banks take deposits from the customers against interest or profit and lend it to the borrowers against interest or profit for a cessation period. Under these circumstances of banks offers different interest rates or profit and other options to the customers to remit and deposit their money. These options are very common among the entire bank, but only the customer services and other facilities vary from bank to bank. More than 90% of financial assets of Bangladesh are owned by different category of banks, which is also largely contributing to the growth in the county’s GDP and employment. In our country there is Govt. Banks, Semi-Govt. Banks, and Private sector have conventional and Islamic bank of Bangladesh. It started its crucial moment/juncture when Bangladesh economy was undergoing through massive economy reforms and pursuing unilateral and multilateral trade liberalization with the backdrop of the World Bank made international monitory fund recommendations. Generally a bank comprises of three departments- General Banking, Credit Department, and Foreign Exchange Department. The department that is most important to a bank and to the interest of the country is Foreign Exchange Department. This United Commercial Bank Limited with its 84 and 25 AD branches in strategize locations of the country is providing the best quality services to the country.

Money exchangers are also providing great support in the evolution and the growth of the foreign exchange system. Many of the customers prefer these money exchangers more than Commercial Banks. The largest source of the foreign currency i.e. remittances is directly related with the operations of this Money exchangers. Bangladesh achieves its lion’s share of income from the RMG sectors. But the firms in these sectors are also highly practicing the foreign exchange dealing because of its more importing nature. They pay a big amount of foreign currencies to their suppliers as they imports raw materials from the abroad. Also receives a huge amount in both USD and GBP form their buyers as their main destination is USA and European countries.