Import payments get more flexibility under new rules

Bangladesh Bank yesterday instructed banks to follow new rules allowing businesses to import goods through open-account arrangements, giving importers greater flexibility to pay for shipments without opening letters of credit (LCs).

Under an open-account arrangement, sellers ship goods with the understanding that payment will be made at a later date.

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The BB issued the clarification two weeks after the commerce ministry issued the Import Policy Order (IPO) 2026-2029, which allows buyers and sellers to enter into direct purchase and sale contracts without opening LCs, irrespective of the value of the transactions.

The order will remain in force until December 31, 2029.

For export-oriented industries, the BB said the import policy order contains specific provisions governing the import and procurement of production inputs.

Under the provisions, such enterprises may procure inputs from local sources in local currency through back-to-back LC arrangements and on a free-of-cost (FOC) basis.

The BB said the new order also provides guidance on the applicability of the bonded warehouse system for the import and procurement of production inputs.

The central bank advised authorised dealer banks -- lenders permitted to buy, sell and manage foreign currencies -- to comply with the provisions of the new order and relevant foreign exchange regulations when settling import transactions and payments for locally sourced inputs.

“The latest guidance is expected to further harmonise foreign exchange procedures with the new import policy framework, enhance flexibility in trade transactions, and facilitate export-oriented industries through simplified sourcing and payment arrangements,” said a senior BB official.