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Lesson 31 of 42 · Part K · Level 2 · Explained

Freelancers: cards, wallets, the ERQ and the rules that stay

How freelancers get paid through Freelancer Cards, mobile wallets and PSPs, how much they may keep in dollars (50% or 30%), what the dollars may pay for, and the rules on tax, time limits, money kept abroad and reporting.

In Lesson 30, Freelancers: who counts, getting paid and the checks, we opened Part K, the circular's one-stop guide for freelancers and individual service exporters. We saw that work sent by internet needs no EXP form, that the bank checks electronic evidence such as e-mails, contracts and platform statements, that inward remittances above USD 20,000 need an online Form-C (ICT) unless other instructions allow otherwise, and that small payments of up to USD 10,000 per transaction can come home through online payment gateways.

Enzo, the young freelance designer from Mirpur, is busier than ever. Since he earned his mobile app development certificate (Lesson 26), he builds small apps and games as well as logos. He arrives at Eliana's export desk with three questions written on the back of a tea-stall receipt: "How much can I keep in dollars? How long can a client make me wait? And my cousin says keep the money abroad in a digital coin. Is he a genius or a danger?"

Eliana laughs. "Good list. Let's ask someone who has seen the whole system from the top." That afternoon her branch's learning session has a guest: Dr Omar, economist, university professor, and a retired government officer who once served as Chairman of the Bangladesh Investment Board. Dr Omar reads the receipt and smiles. "Cards, wallets, the dollar share and the rules that never go away. Part K answers all three questions, and your cousin's too." This lesson covers K-6 to K-11, the second half of Part K.

Para K-6New to the master circular

Receipts through Cards, MFSPs, and PSPs

In plain words

K-6 lists the roads a freelancer's money can take to reach home, besides the ones you met in Lesson 30.

(1) The Freelancer Card. ADs may issue a dual-currency 'Freelancer Card' to eligible freelancers, to receive export proceeds. Who is eligible, and how the card works, sit in paragraph 4, Part-I of the circular. That is the I-4 card from Lesson 26, with a foreign currency unit and a Taka unit. K-6 does not repeat those details; it simply points back.

(2) MFSPs and PSPs. Mobile Financial Service Providers (MFSPs) and Payment Service Providers (PSPs), working with foreign PSPs, may help bring service export proceeds home. They follow the framework in paragraph 6, Part-I, which you met in Lesson 27 (I-6).

(3) Where the money lands. Funds are credited to the freelancer's digital wallet or bank account, according to the settlement mechanism behind the payment.

(4) Keeping dollars on the wallet road. ADs may keep ERQ accounts in the name of ITES (IT-enabled services) exporters, in coordination with MFSPs and PSPs, up to the permissible retention limit out of the repatriated proceeds. Then the order matters:

  1. the AD makes sure the foreign currency is in the ERQ account first, under the standing arrangements;
  2. only then does the rest move on to the settlement accounts of the MFSPs and PSPs.

This follows paragraph 6(2)(c), Part-I. Think of a family dinner: the dollar share is served first, then the rest goes to the Taka table. K-6 itself does not set the retention limit; K-7 does.

At the desk

Enzo's client abroad pays USD 800 for a game through a foreign PSP that works with a local PSP. Eliana's bank keeps an ERQ account for Enzo, arranged with that PSP. Before anything moves to the PSP's settlement account, Eliana makes sure Enzo's chosen dollar share is sitting in his ERQ account in foreign currency. Only then does the rest go on to the PSP, which credits the Taka to Enzo's digital wallet. Dr Omar nods. "Dollars first, Taka second. The order protects the customer."

Key words
Freelancer Card
An international card that ADs issue under I-4 to individual developers/freelancers of mobile apps and games. It has two currency units and is prepaid from abroad.
MFSP
Mobile Financial Service Provider: a company licensed by Bangladesh Bank that runs digital wallets people use on their mobile phones.
PSP
Payment Service Provider. Under I-6, a PSP licensed by Bangladesh Bank works with foreign PSPs (online gateways, digital wallets or aggregators abroad) to bring export money into customers' digital wallets.
Settlement account
An account in equivalent Taka that an MFSP or PSP keeps with an AD. Export money from foreign PSPs passes through it on its way to customers' digital wallets.
Read the rule as written (Para K-6)

(1) ADs may issue dual-currency 'Freelancer Cards' to eligible freelancers for receipt of export proceeds, in accordance with the provisions and operational modalities outlined in paragraph 4, Part-I of this circular.

(2) Mobile Financial Service Providers (MFSPs) and Payment Service Providers (PSPs), in association with foreign PSPs, may facilitate the repatriation of service export proceeds in line with the framework and instructions set out in paragraph 6, Part-I of this circular.

(3) Funds shall be credited to digital wallets or bank accounts of freelancers in accordance with underlying settlement mechanisms.

(4) ADs may maintain ERQ accounts in the name of ITES exporters in coordination with MFSPs and PSPs, up to the permissible retention limit out of repatriated export proceeds. In such cases, ADs shall ensure availability of funds in the ERQ accounts in foreign currency in accordance with standing arrangements, prior to onward transfer of funds to the settlement accounts of MFSPs and PSPs, in line with paragraph 6(2)(c), Part-I of this circular.

Source: Bangladesh Bank, FEPD-1 Circular No. 26, 30 July 2026, Part K, paragraph 6 (page 44). The original circular is the authority.

Para K-7New to the master circular

ERQ facilities and utilization

In plain words

K-7 answers Enzo's first question: how much may he keep in dollars?

(1) The retention share. Service exporters may keep in foreign currency, in line with Part-O of the circular:

  • up to 50% of net export earnings from software, data entry/processing and other ICT-related services;
  • up to 30% from other legitimate services.

Notice the words "up to". The freelancer may keep less, or nothing, but not more. In Part-I (Lessons 26 and 27) the circular only spoke of the "eligible" or "permissible" ERQ share; K-7 now gives the figures and points to Part-O for the ERQ rules.

(2) The rest becomes Taka. Whatever is not retained must be converted into Taka and credited to a local currency account. There is no third pocket.

(3) What the ERQ dollars may pay for. Balances in ERQ accounts may be used for bona fide current expenses, such as:

  • foreign travel;
  • software registration;
  • domain and hosting fees;
  • server maintenance;
  • import of equipment;
  • and legitimate personal expenses.

The words "such as" mean the list gives examples. The key test is that the expense is genuine and a current expense.

A quick sum: an app developer earns net USD 1,000. He may keep up to USD 500 in his ERQ account. If he keeps USD 500, the other USD 500 is converted into Taka. The circular does not define "net export earnings" in K-7.

At the desk

Enzo's net earnings from mobile app work this month are USD 2,000. Eliana explains that, as an ICT-related service, he may keep up to USD 1,000 in his ERQ account, and the rest must be converted into Taka. Enzo keeps USD 800, planning to pay his hosting fees and a software registration abroad, and the remaining USD 1,200 goes to his Taka account. Dr Omar adds, "Keep dollars for dollar costs. That is what the quota is for."

Key words
ERQ
Exporters' Retention Quota: the share of export earnings an exporter may keep in foreign currency, in an ERQ account.
Bona fide
Genuine; made in good faith.
Current account payment
A payment for everyday trade and services, such as paying for imported goods or a training course. Different from a capital payment, such as buying property or shares abroad.
Encashment
Converting foreign currency received into Taka.
Read the rule as written (Para K-7)

(1) Service exporters may retain up to 50% of net export earnings in foreign currency against export of software, data entry/processing, and other ICT-related services, and up to 30% in respect of other legitimate services, in accordance with Part-O of this circular.

(2) The remaining portion shall be mandatorily converted into Taka and credited to local currency accounts.

(3) Balances in ERQ accounts may be used for bonafide current expenses such as foreign travel, software registration, domain/hosting fees, server maintenance, and import of equipment, including legitimate personal expenses.

Source: Bangladesh Bank, FEPD-1 Circular No. 26, 30 July 2026, Part K, paragraph 7 (page 44). The original circular is the authority.

Para K-8New to the master circular

Taxes and regulatory compliance

In plain words

K-8 is short: two duties that sit behind every payment.

(1) Taxes. ADs shall ensure that taxes are deducted and paid, if applicable. Notice who carries the duty: the AD, not the foreign client. K-8 does not give a tax rate or say which taxes apply; it only says "if applicable".

(2) Compliance. All transactions must comply with:

  • KYC (Know Your Customer) standards;
  • AML/CFT standards; and
  • the relevant foreign exchange regulations.

"All" means all. A USD 50 logo fee gets the same basic care as a USD 15,000 app contract. As Dr Omar likes to say, "A rule that only applies to big amounts teaches people to make small amounts." This links back to Lesson 30, where the bank checks that the freelancer is genuine and has the skills for the work.

At the desk

A new customer, a freelance video editor, receives USD 150 and asks Eliana to skip the ID check, since "it's only pocket money". Eliana explains that K-8 applies KYC and AML/CFT standards to all transactions, whatever the size. She completes the KYC, credits the money, and makes sure any applicable tax is deducted and paid. The customer grumbles, then admits the check took less time than his morning cha.

Key words
KYC
Know Your Customer: checking who the customer really is.
AML/CFT
Anti-Money Laundering / Combating the Financing of Terrorism rules.
Read the rule as written (Para K-8)

(1) ADs shall ensure deduction and payment of taxes, if applicable.

(2) All transactions shall comply with KYC, AML/CFT standards, and relevant foreign exchange regulations.

Source: Bangladesh Bank, FEPD-1 Circular No. 26, 30 July 2026, Part K, paragraph 8 (page 44). The original circular is the authority.

Para K-9New to the master circular

Time limit for repatriation

In plain words

K-9 answers Enzo's second question: how long can a client make him wait?

The rule: export proceeds from services must be repatriated (brought home) within the prescribed time limits that apply to the export of goods.

So a freelancer gets no extra time just because nothing went through a port. A logo, an app or a data job is treated like a carton of T-shirts when it comes to the deadline for bringing the money home.

K-9 does not repeat the number of days or months. It points to the time limits already set for goods. You met the same idea in Lesson 24 (H-4), which applied the goods repatriation instructions equally to services.

In practice, a freelancer should agree payment terms with a client that fit inside those limits. "Pay whenever you like" is friendly, but it is not a payment term.

At the desk

A client abroad offers Enzo a big app project, and writes: "We will pay whenever our budget allows, maybe next year." Eliana explains that under K-9, service proceeds must come home within the same time limits as goods exports. Dr Omar suggests Enzo ask for a clear payment date that fits those limits before starting work. Enzo sends the client a polite reply with a fixed date.

Key words
Repatriation
Bringing export money back into Bangladesh through a bank.
Realisation
Actually receiving the export money, so the bill is settled.
Read the rule as written (Para K-9)

Export proceeds from services shall be repatriated within the prescribed time limits applicable to export of goods.

Source: Bangladesh Bank, FEPD-1 Circular No. 26, 30 July 2026, Part K, paragraph 9 (page 44). The original circular is the authority.

Para K-10New to the master circular

Prohibition on retention abroad

In plain words

K-10 answers Enzo's third question, and his cousin's idea.

The rule: keeping export proceeds abroad, in any form, is a violation of the Foreign Exchange Regulation Act, 1947. The circular names some forms, and the word "including" shows the list is not complete:

  • foreign accounts;
  • assets;
  • virtual assets, such as a digital coin.

The one exception: permitted notional/merchant accounts under approved arrangements. These are the accounts allowed under Part-I, for example with online payment gateways and marketplaces. They are a channel for bringing money home, not a place to store it.

So the cousin's plan to keep the money abroad in a digital coin is not genius. It breaks the law. Lesson 24 (H-5) gave the same warning with more legal detail; K-10 says it in one sentence.

Dr Omar puts it simply: "Earn abroad, bring it home. The dollars a freelancer brings in help pay for the country's imports, just like garment money." K-10 does not set out the penalty itself.

At the desk

Enzo tells Dr Omar and Eliana that his cousin keeps freelance earnings in a foreign bank account and in a digital coin, "for safety". Eliana explains that under K-10, keeping export proceeds abroad in any form, including foreign accounts and virtual assets, violates the FER Act, 1947. The only exception is a permitted notional/merchant account under an approved arrangement. Enzo decides to forward the paragraph to his cousin that evening.

Key words
Retention abroad
Keeping export money outside Bangladesh, in any form, instead of bringing it home.
Virtual asset
A form of value that exists only in digital form, such as a cryptocurrency.
Notional/merchant account
An account that Part-I (paragraphs 3 and 5) lets a service exporter keep, to bring income home through an AD in Bangladesh.
FER Act 1947
Foreign Exchange Regulation Act. The main law behind Bangladesh Bank's foreign exchange rules.
Read the rule as written (Para K-10)

Retention of export proceeds abroad, in any form (including foreign accounts, assets, or virtual assets), other than permitted notional/merchant accounts under approved arrangements, shall constitute a violation of the Foreign Exchange Regulation Act, 1947.

Source: Bangladesh Bank, FEPD-1 Circular No. 26, 30 July 2026, Part K, paragraph 10 (page 44). The original circular is the authority.

Para K-11New to the master circular

Reporting and record-keeping

In plain words

K-11 closes Part K with the bank's paperwork duty.

ADs shall:

  1. report all transactions to Bangladesh Bank, with the appropriate purpose codes; and
  2. maintain proper records, so the transactions can be reviewed by the regulator.

Why does a little code matter so much? Because it tells the country what the money was for. If a freelancer's app fee is coded as something else, it disappears from the service export figures. Then nobody can see how much the country really earns from its freelancers.

K-11 does not list the codes. In Part-I (Lesson 26), the Freelancer Card receipts were reported under the code for ICT/computer services.

Records matter too. A tidy file today saves a long search when a reviewer asks questions next year.

At the desk

On a busy Thursday, a colleague codes three of Enzo's app payments under a general code to clear the queue faster. Eliana catches it and changes each one to the purpose code that fits a service export, as K-11 requires. She files the client e-mails and remittance messages with the records. Dr Omar says, "Every correct code is one more true number in the country's books."

Key words
Purpose code
A code a bank attaches to a foreign exchange transaction when reporting it, to show what the money was for.
Read the rule as written (Para K-11)

ADs shall report all transactions to Bangladesh Bank with appropriate purpose codes and maintain proper records for regulatory review.

Source: Bangladesh Bank, FEPD-1 Circular No. 26, 30 July 2026, Part K, paragraph 11 (page 44). The original circular is the authority.

Putting it together

So far: Eligible freelancers (under paragraph 4, Part-I) can get paid through a dual-currency Freelancer Card, and freelancers can also be paid through MFSPs and PSPs working with foreign PSPs, with money landing in digital wallets or bank accounts, and ADs may hold ERQ accounts for ITES exporters, filled in foreign currency before the rest goes to the settlement account. Service exporters may keep up to 50% of net export earnings (software, data entry/processing and other ICT-related services) or up to 30% (other legitimate services) in foreign currency, convert the rest into Taka, and use ERQ balances for bona fide current expenses. Taxes, KYC, AML/CFT and foreign exchange rules apply to every transaction; proceeds must come home within the same time limits as goods; keeping proceeds abroad in any form, outside permitted notional/merchant accounts, violates the FER Act, 1947; and ADs report everything with proper purpose codes and keep records.

Next: Part K of the export room is complete. Part L, on streamlining the disposal of inward remittances, starts in Lesson 32, Inward remittances: telling the customer and crediting on time.

Check yourself

30 questions, in 3 sets of up to 10. Nobody sees your answers but you.

Set 1 of 3

1. Under K-6, what kind of card may ADs issue to eligible freelancers to receive export proceeds?
2. Where are the provisions and operational modalities for the Freelancer Card set out, according to K-6?
3. Under K-6(2), MFSPs and PSPs may help bring service export proceeds home in association with whom?
4. True or false: under K-6, funds brought home through MFSPs and PSPs may only be credited to bank accounts, never to digital wallets.
5. Desk case: an ITES exporter keeps an ERQ account with Eliana's bank, arranged with a PSP. A payment arrives. When must the foreign currency be in the ERQ account?
6. Desk case: an officer of a local PSP asks Eliana where the circular's framework for MFSP and PSP repatriation of service proceeds sits. What should she say?
7. How much may ADs keep in ERQ accounts of ITES exporters, in coordination with MFSPs and PSPs?
8. Under K-7, up to what share of net export earnings may a service exporter keep in foreign currency for software, data entry/processing and other ICT-related services?
9. Under K-7, up to what share may a service exporter keep in foreign currency for other legitimate services?
10. Desk case: Enzo's net earnings from mobile app development this month are USD 2,000. What is the most he may keep in his ERQ account?

Set 2 of 3

11. Desk case: a customer earns net USD 1,000 from a legitimate service that is not software, data entry/processing or ICT-related. What is the most he may keep in foreign currency?
12. True or false: under K-7, the portion a freelancer does not retain may stay in foreign currency in a savings account if he prefers.
13. Which of these is NOT among the examples of bona fide current expenses that K-7 gives for ERQ balances?
14. Desk case: Enzo wants to use his ERQ balance to pay a software registration fee and to import a new computer for his work. What should Eliana tell him?
15. Which part of the circular does K-7 point to for the retention of export earnings in foreign currency?
16. True or false: K-7 allows ERQ balances to be used for legitimate personal expenses.
17. Under K-8, who must ensure that applicable taxes are deducted and paid?
18. Under K-8, all freelancer transactions must comply with which standards?
19. Desk case: a freelance video editor receives USD 150 and asks Eliana to skip the KYC check because the amount is small. What should she do?
20. True or false: K-8 sets a fixed tax rate for freelancers' export earnings.

Set 3 of 3

21. Under K-9, within what time must service export proceeds be repatriated?
22. Desk case: a client abroad tells Enzo, 'We will pay whenever our budget allows, maybe next year.' What is the best advice?
23. Why does K-9 matter to a freelancer whose work never passes through a port?
24. True or false: under K-10, keeping export proceeds abroad in virtual assets violates the Foreign Exchange Regulation Act, 1947.
25. Which is the only exception K-10 allows to the ban on keeping export proceeds abroad?
26. Desk case: Enzo's cousin keeps his freelance earnings in a foreign bank account 'for safety'. How does K-10 treat this?
27. Under which law does K-10 say keeping export proceeds abroad is a violation?
28. Under K-11, how must ADs report freelancers' transactions to Bangladesh Bank?
29. Desk case: to clear a queue, a colleague codes Enzo's app payments under a general code that does not show a service export. What should Eliana do?
30. Desk case: Eliana files client e-mails and remittance messages for each of Enzo's payments. Which K-11 duty is she meeting?
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