Raising Capital in Bangladesh

Capital is the lifeblood of growth, but raising it in Bangladesh involves more than finding a willing investor or lender. Each source of money comes with its own paperwork: share allotments that must be filed at RJSC, foreign equity that must arrive through banks with encashment certificates, foreign loans that may need BIDA or Bangladesh Bank approval, and bank credit that depends on clean audited accounts and tax compliance.

This page is for founders, family companies and subsidiaries of foreign groups planning a capital increase or new financing. We prepare the company and its documents, support the financial case and handle the corporate and tax filings. We do not act as an underwriter, issue manager or merchant bank, and we coordinate with BSEC-licensed intermediaries where a regulated offer is involved.

Sources of capital for Bangladeshi companies

• New equity from existing shareholders through a rights issue or further allotment
• Equity from new local or foreign investors, including angels and venture or private equity funds
• Shareholder or director loans, documented with terms
• Bank term loans and working capital facilities, including refinance schemes run through banks
• Foreign loans from parent companies or lenders, subject to approval routes
• Preference shares or convertible instruments, where the Articles permit

Corporate steps for issuing new shares

If the new shares will exceed authorised capital, the company first increases authorised capital by resolution and files the change with RJSC, paying the applicable fees and stamp duty. The board then allots shares, a return of allotment is filed with RJSC within the prescribed time, and share certificates and the register are updated. Pre-emption rights in the Articles and any shareholder agreement must be respected.

Depending on the type of company and the amount and manner of the issue, consent from the Bangladesh Securities and Exchange Commission or compliance with its private placement rules may be required; this should be checked before an offer is made.

Foreign equity and foreign loans

Foreign share capital must be remitted through a scheduled bank, with an encashment certificate obtained and retained. Shares are then allotted to the foreign investor and the investment recorded with BIDA where applicable. This documentation is what later allows dividends and capital to be repatriated under the Foreign Exchange Regulation Act 1947 and Bangladesh Bank guidelines.

Foreign loans, including from a parent company, generally follow an approval or reporting route through BIDA or Bangladesh Bank depending on the borrower and terms; drawing funds before approval can create serious problems.

What investors and lenders will ask for

• Audited financial statements and up-to-date management accounts
• Business plan and financial model with use of funds
• Clean RJSC records, e-TIN, BIN, trade licence and sector licences
• Evidence of income tax and VAT compliance, including PSRs and filed returns
• Cap table showing all shareholders and any options or convertibles
• Credit history from the CIB of Bangladesh Bank for loan applications

Capital raising mistakes

• Accepting foreign money into a personal account instead of the company account
• Allotting shares without filing the return of allotment
• Using informal loans that later look like unexplained income to the tax authority
• Raising funds without a clear use-of-funds plan investors can track
• Ignoring how a new round affects control and existing shareholder rights

How the process works

1. Funding planWe help size the requirement, choose between equity and debt and model the effect on ownership and cash flow.
2. Readiness reviewWe check records, compliance and financial statements and fix gaps investors or banks would spot.
3. Investor and lender materialsWe prepare the financial model, use-of-funds and supporting schedules.
4. ApprovalsWe map and support RJSC, BIDA, Bangladesh Bank and, where applicable, BSEC requirements.
5. Completion filingsWe file allotments or charges at RJSC and keep remittance and encashment records.

Typical timeline: Equity raised from existing shareholders can be documented in a few weeks; new investor rounds, foreign loans and regulatory consents typically take longer, depending on negotiations, documents and authority processing.

How Tax & VAT Associates helps

• Funding requirement and capital structure analysis
• Investment readiness and compliance review
• Financial model and use-of-funds schedules
• Authorised capital increase and return of allotment filings at RJSC
• Foreign remittance, encashment and BIDA record coordination
• Registration of charges for secured loans at RJSC

Frequently asked questions

Related services

Last reviewed: 6 October 2026. Bangladesh tax and regulatory rules change with each Finance Act, SRO and authority circular. This page is general guidance; confirm current requirements for your case before filing.