After banks, the Bangladesh Bank has now set the profit limit for money changers at Tk1.5 from buying and selling every cash dollar in the open market as part of an effort to stabilise the country's foreign exchange market.
From now on, a money changer will be able to sell the dollar at a price of Tk1 to a maximum of Tk1.50 more than the price at which it buys the greenback, the central bank top executives told the leaders of the money changers' association at a meeting on Wednesday.
The central bank earlier instructed banks to make a maximum profit of Tk1 per dollar.
A senior official of the central bank said money changers were asked to explain why they made high profits. In response, the association leaders in the meeting pointed to the dollar crisis in the market.
Speaking to journalists after the meeting, Bangladesh Bank Executive Director and spokesperson Md Serajul Islam said a decision was made in a meeting with the Association of Bankers, Bangladesh (ABB) and the Bangladesh Foreign Exchange Dealers' Association (Bafeda) to sell dollars at a maximum price of Tk1 more than the price at which banks will bring remittances and export bills. They have made a decision in principle in this regard.
"Likewise, the same decision has been made in Wednesday's meeting with the money changers association. In this case, they will buy dollars at an additional price of Tk1 from the average rate of banks. Money changers can make a profit of up to Tk1.50 on subsequent sales. As we have observed the buying and selling of dollars by the banks, the same has been done in the money changers," he added.
The central bank spokesperson said currently 235 money changers are doing business with permission from the Bangladesh Bank. But there are more than 700 money changers in the market.
"We can take action against legitimate money changers for any irregularities. But the Bangladesh Bank has requested law enforcement agencies to take action against those who are illegal. They are taking action in this regard. Their campaign is still ongoing," he added.
Deputy Governor Ahmed Jamal represented the central bank in the meeting with money changers.
Another source in the meeting said the leaders of the Money Changers Association of Bangladesh requested the central bank to allow five suspended money changers to operate after imposing fines. The Bangladesh Bank rejected the request.
Helal Uddin, secretary of the money changers association, told TBS, "In the meeting, some demands from our side were also presented before the central bank. We have called for increasing our end-of-day currency holding limit from $25,000 to $100,000."
He said they have also requested the central bank to increase the limit of selling dollars through passport endorsements. Currently, money changers can sell up to $1,000 through passport endorsements.
"We have called for increasing it to $5,000. Besides, we have requested the central bank to halt the operation of unauthorised money changers," he added.
Helal Uddin said the central bank has instructed money changers to arrange training programmes for their officers and employees in dollar trading and account keeping.
"We have also been assured that the central bank will send trainers to these programmes," he added.
Dollar drops to Tk110 in the open market
The price of the dollar has fallen further in the open market. On Wednesday, most money changers in the country bought dollars at Tk108 and sold them at Tk110. On Tuesday, the open market price of the greenback was Tk111.
On Thursday, the price of the dollar crossed Tk120 due to the acute shortage of the greenback at money changers. However, due to the strict stance of the Bangladesh Bank, the price fell by Tk8 to Tk112 on Sunday.
The central bank has suspended the operations of five money changers for influencing the price of the dollar in the open market.
Besides, the Bangladesh Bank also warned 42 money changers on various charges.