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Questions and Answers
Outsourcing is a practice used by banking institutions to:
What impact can outsourcing have on banks?
How can banks mitigate the risks associated with outsourcing?
What should banks do when outsourcing significant parts of their activities?
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What is the purpose of the BRPD Circular No-02 mentioned in the text?
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According to the Digital Security Act, 2018, what is the purpose of the English translation of the Act?
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When did the Digital Security Act, 2018 come into effect?
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Which division of the Government of the People's Republic of Bangladesh issued the notification for the Digital Security Act, 2018?
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What is the Act No. of the Digital Security Act, 2018?
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What powers conferred by the Digital Security Act, 2018 enabled the Government to publish the English translation of the Act?
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Study Notes
Outsourcing in Banking
- Outsourcing is employed by banking institutions to improve efficiency, reduce costs, and access specialized services.
- It can lead to increased operational flexibility, allowing banks to focus on core business activities.
Impact of Outsourcing on Banks
- Potential for reduced focus on internal controls which may increase operational risks.
- Dependency on external providers can lead to vulnerabilities in service delivery and data security.
- Overall cost savings can be achieved, but may be counterbalanced by risks.
Mitigating Risks of Outsourcing
- Banks should establish robust contracts and due diligence processes to ensure compliance and accountability from third-party providers.
- Ongoing monitoring and performance assessments are essential to managing outsourced activities effectively.
- Development of contingency plans is crucial to address potential service disruptions.
Responsibilities When Outsourcing Major Activities
- Institutions are required to conduct thorough risk assessments regarding the activities being outsourced.
- Proper governance structures should be in place to oversee outsourced functions.
- Regular communication with service providers is necessary to ensure alignment with the bank's policies and objectives.
Purpose of BRPD Circular No-02
- This circular establishes guidelines for banks related to outsourcing practices, ensuring regulatory compliance and risk management in outsourcing arrangements.
Digital Security Act, 2018
- The purpose of the English translation of the Digital Security Act is to make the legislation accessible to non-Bengali speakers and ensure wider understanding and compliance.
- The act came into effect on October 1, 2018, addressing digital security issues.
Government Notification for the Digital Security Act
- The Ministry of Posts, Telecommunications, and Information Technology, Government of the People's Republic of Bangladesh, issued the notification for the Digital Security Act, 2018.
Act No. of the Digital Security Act, 2018
- The Digital Security Act is designated as Act No. 24 of 2018.
Powers Conferred by the Digital Security Act
- The act empowers the government to enforce regulations regarding digital security, allowing the publication of official documents, including the English translation of the Act for public dissemination and understanding.
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Description
Test your knowledge on banking regulations and outsourcing with this quiz. Learn about the guidelines and best practices when it comes to outsourcing arrangements in the banking industry.
