Banks asked to ensure smooth service of torn note exchange

Bangladesh Bank (BB) has directed all commercial bank branches to ensure smooth services for exchanging torn, defective and soiled notes, warning of action against those reluctant to comply.

In a circular issued yesterday, the central bank said branches must provide exchange value for non‑issuable and mutilated notes if more than 90 percent of the note is intact and genuine security features are present.

Notes divided into two parts must be attached to thin white paper to facilitate identification.

However, claimable notes will not be settled at the branch level. Instead, banks must forward such notes to the nearest BB office, which will decide on payment within eight weeks.

Postal or courier charges for sending claimable notes will be borne by the depositor.

Charred notes must be submitted directly to the BB's claims desk. The circular also said that counterfeit or "built‑up" notes created from multiple fragments will invite legal action under existing policy.

Branches have been instructed to display notices informing customers that services for exchanging torn, defective and claimable notes are available.

Monthly reports on receipt of such notes must be submitted to the central bank to ensure transparency and accountability in cash transactions.