The Central Bank of Myanmar (CBM) has announced that it will allow banking agents to perform banking services including cash depositing and cash withdrawals on behalf of the banks.

The Central Bank of Myanmar, exercising its mandate under Section 184 of the Financial Institutions Law, issued the Representative Banking Directive dated February 6, 2024, in order to provide comprehensive access to financial services to the people who do not have access to banking services, and to increase overall participation in the financial system by setting a framework for the banking services of the relevant bank without affecting the safety and soundness of the banking system.

A bank wishing to provide representative banking services must apply to the CBM. The CBM will notify the bank by letter of approval within three months from the date of receipt of the completed application. An incomplete application will be notified to the relevant bank within three months, stating the requirements. Upon receipt of the resubmitted application form, it will be verified and approved and if it is not complete, it will be rejected.

As agreed between the bank and representative banking service representative, the representative can perform the following banking activities: cash deposits and withdrawals, collection of invoices and submission to the bank, collection of loan repayments and supporting documents related to loan applications, internal remittances, retirement pay and government grants and disbursement of social benefits such as subsidies provided by social organizations, checking account balances, responsible for correspondence services between the bank and customers, and banking services authorized by the CBM from time to time.

The statement states that all financial operations conducted by the bank through its appointed representative must be conducted in Myanmar kyats only.

The CBM conducts investigations and requests for information or data on banks and representatives appointed to carry out banking supervision work, field inspection, termination of agency contract, instructing the bank to take remedial measures for the agent's wrong actions and conducting field inspections from time to time to the place where the agent will perform banking services under the Financial Institutions Law.

If banks and banking service agents fail to comply with any of the provisions of the directive, they will be subject to action under the Financial Institutions Law.

The bank must allow the representative to perform banking services only during banking hours, and the instruction must be effective from the date of publication.