Saturday, February 23, 2019
Foreign Banks Pros and Cons Essay
Today with the blessings of tremendous development in the communication engine room, relationship and interdependence among the countries learn been growing rapidly which signifies globalization as an ongoing process. Globalization helps the international business- that is engaging in put over border expansion of sales, acquiring resources and diversifying risk. Factor that benefiting the outside banks in Bangladesh Bangladesh is a developing estate with a huge population.From the beginning of Bangladesh as an self-employed person country it has been a desiring clothe for doing business for business organizations operating(a) globally. This thoughtfulness is existed in banking and other financial service sectors. There are any(prenominal) factors that benefitting the strange banks operating in Bangladesh.1. Extended sales in an staggeringly populated country with a low contender Bangladesh is a country with a large population, so this place is a fully grown muckle for t he banks in a single boundary with a simple hard-boiled of legislations.So the foreign banks operating in Bangladesh jakes serve a large group of customers with a single marketing policy. As promptly a day the business transactions are taken place through banks and house hold savings are kept in banks so the foreign banks do non have to be implicated about the demand. The local anesthetic banks can not give a big competition as well.2. Minimizing risk As usual the transnational banks manage other multinational corporations minimize risk by operating in Bangladesh.That means if the banking sector collapses in a country the multinational banks go forth not loose e trulything and it is a risk diversifying method. 3. Acquiring resources The foreign banks operating in Bangladesh can acquire Bangladeshi capitals, in ashesation and human resources easily. The local expertise is keen to work in MLCs. So the foreign banks can acquire the local human resources easily at a very cheap r ate compare to the global condition. Having the benefits in Bangladesh 10 local banks have established their operation in our country and working intimately for years after years.Influences of foreign banks in Bangladesh Benefits 1. A boast in banking sector Local banks are expected to react as the foreign banks enter to the country. The local banks here have changed their police in a positive way caused by healthy competition. 2. Bringing ne worry and advertising techniques foreign banks typically bring newer and more modernized worry and advertising techniques in our banking sectors. The local banks can learn the modern techniques to distinguish up with the changing economic environment and globalization.3. Introducing new modernized technology In Bangladesh most of the modern financial technology such as ATM, different types of cards, off balance sheet accounting and the latest calculation technology brought by foreign banks and spread out in undivided banking sectors. 4. H elping in international trade Aiding in the development of trade and foreign direct investment are presented by foreign banks. much(prenominal) as opening an L/C in a multinational bank may be more helpful for the merchants. Problems1). Foreign domination the established foreign banks have far greater brand prise and economic capability than the local banks. So they can easily look out over by attracting customers. They also are being magnets for local human resources, so the local banks do not get the local expertises which also chicken out the local banks behind the multinational banks.2). Lack of local commitment the foreign banks lack commitment towards the country for some reasons not meeting some social responsibilities.3.)Cream skimming behavior though there is not much data available to prove this fact many citizenry think that the foreign banks cream skim the market- taking disproportionate voice of best local business away from domestic banks.4). Unhealthy period introduction of foreign banks has added pressure to the local banks by increasing competition which results in risk taking of local banks. So the foreign banks of Bangladesh have a great influence in our economy in the form of pros and cons which are effectively altering our banking sector, with their operation.