US-based electronic fund transfer service Paypal's Xoom has not become quite popular in Bangladesh in the past two years although it enabled users to wire money from one country to another within seconds.
One of the main reasons behind this is that the service does not facilitate transactions at the moment, but only transfers.
According to bank officials, Bangladesh Bank will not take any measures in the near future to promote the service since it increases risks of money laundering.
When the Paypal Xoom service was launched on Oct 19, 2017, the then Bangladesh Bank Governor Fazle Kabir had said that the services would also be available at Sonali Bank, Rupali Bank, Agrani Bank, Janata Bank, Social Islami Bank, Uttara Bank, Pubali Bank, Citi Bank and Islami Bank Bangladesh.
However, recent investigations show that the service is available only at three banks.
Bangladesh Bank Spokesperson and Executive Director Sirajul Islam told Bangla Tribune said that the service was available at Sonali Bank, Rupali Bank and Dutch Bangla Bank at present.
The central bank, however, had no knowledge about how much money was being brought into the country through the service.
The central bank did not want to enable customers to remit money outside the country through the service as it believed that would cause greater amounts of money to flow out of the system and add to money laundering risks.
The central bank wanted to ensure that money laundering could be kept under check and therefore did not want to popularise the service at present, said Sirajul Islam.
An official of the foreign remittance operation section at Sonali Bank said, “A strong policy was needed before all Paypal services were opened up for customers; otherwise, huge amounts of money would flow out of the country and incidents of money laundering would rise.”
According to sources at Islami Bank Bangladesh, the bank has not been able to launch the service till date and the service IS losing popularity among existing customers
The service was mainly used by customers who lived in Singapore and the United States to remit money home through the Sonali Bank in most cases, the sources said.
A high-ranking official at Sonali Bank’s foreign remittance management section, who wished to remain anonymous, said that despite various initiatives taken to make the service popular, only those who had accounts at the bank were using it.
After the service was launched, Paypal account holders living in the US could send upto $10,000 per transfer. A fee of 4.99 dollars is charged per $1,000 remitted but no fee is charged for transfers above 1,000 dollars.