After the amendment of regulations governing the management of foreign exchange transactions in the country, the Central Bank of Myanmar began allowing foreign exchange (forex) transfers by local banks. However, the transfers by local banks are not in line with international practices and this hampers businesses, some business owners say.

The requirement by local banks that bills of lading be shown before forex transfers are made complicates business deals, says U Nay Lin Zin, the owner of an import-export business.

“In trading, we often use a credit system. Sometimes, although the goods have been delivered, payment is only made in the next six months. So, when we haven’t got the money from a buyer yet, we have to transfer our own money from other accounts via Singapore banks to our own bank. It adds unnecessary service costs,” said U Nay Lin Zin.

As most of the local businesspeople are making payments for trade via Singaporean banks, only these banks are getting the benefits from service charges, they said.

“For every money remittance, the documents for cargo shipping must be shown. And for cases where cargo shipping will occur after the advance payment, they want a bill of lading in two months, which is ridiculous. These procedures are making it more difficult for local businesspeople to use local banks,” wrote one businessperson on the social network page of CBM’s deputy governor.

Local banks say that the requirement is based on CBM instructions.

Attempts by Myanmar Times to reach the CBM and Foreign Exchange Management Department for comment have been unsuccessful so far.

Foreign Exchange Management Law was enacted in in 2012 and amended on December 15, 2015. The amendment states that citizens in and out of the country will have to follow the CBM’s instructions for transporting gold, foreign currency and jewellery in or out of the country. – Translated

Source: https://www.mmtimes.com/news/businesses-lament-bank-rules-transfers.html