The leasing industry in Bangladesh is regulated by the Financial Institutions Act 1993 and the Bangladesh Bank, the central bank of the country. The law provides the legal framework for leasing companies’ establishment, operations, and regulation.
Under the Financial Institutions Act 1993, leasing companies are defined as non-bank financial institutions that provide finance for leasing or hire purchase of goods, including machinery, equipment, vehicles, and other capital goods. Leasing companies in Bangladesh are required to obtain a license from the Bangladesh Bank to operate.
The Bangladesh Bank regulates the leasing industry and sets out guidelines and regulations that leasing companies must comply with. These guidelines include capital adequacy requirements, asset quality, and provisioning standards, and the establishment of internal control systems.
In addition to these regulations, the Bangladesh Bank also requires leasing companies to maintain minimum capital adequacy ratios, which vary depending on the size and nature of the company’s operations. The Bank also requires leasing companies to submit regular reports and returns to ensure compliance with regulatory requirements.
The Financial Institutions Act 1993 also provides for the protection of the interests of leasing company customers. The Act sets out rules for the disclosure of information to customers, including the terms and conditions of the lease, interest rates, and fees. The Act also provides for the resolution of disputes between leasing companies and their customers.
In conclusion, the leasing industry in Bangladesh is regulated by the Financial Institutions Act 1993 and the Bangladesh Bank (central bank). Leasing companies are required to obtain a license to operate and must comply with various regulatory requirements, including capital adequacy ratios, asset quality standards, and internal control systems. The Act also provides for the protection of customers’ interests and the resolution of disputes.
As a law firm, we provide valuable assistance to leasing companies and their customers. Leasing companies play an essential role in the country’s economy by providing financing for capital goods, equipment, machinery, and vehicles.
We assist leasing companies in complying with the regulatory requirements set out by the Financial Institutions Act 1993 and the Bangladesh Bank. This may include providing guidance on the licensing process, regulatory compliance, and compliance with minimum capital adequacy ratios.
We also provide legal assistance in drafting and negotiating leasing agreements, ensuring that the terms and conditions of the lease are in compliance with the law and protecting the interests of the leasing company and its customers.
Furthermore, we represent leasing companies in disputes with their customers, such as disputes over lease terms, interest rates, or defaults. This may involve litigation or alternative dispute resolution (ADR) methods, such as arbitration or mediation.
Moreover, we provide guidance to leasing companies on the various types of leasing transactions, such as financial leases and operating leases, and their respective advantages and disadvantages. Our experts also assist leasing companies in structuring lease transactions to comply with regulatory requirements and optimize tax efficiency.
