Bangladesh Bank eases LC opening for daily essentials ahead of Ramadan

Bangladesh Bank has relaxed the conditions for opening letters of credit (LCs) for importing goods, to keep the supply of daily essentials normal during the upcoming holy month of Ramadan. From now on, banks will be able to set the cash margin rate for opening LCs for the listed products on the basis of the bank-customer relationship.

The Banking Regulation and Policy Department-1 of Bangladesh Bank issued a circular in this regard on Sunday. The instruction has been sent to the managing directors and chief executive officers of all scheduled banks in the country.

The circular says the demand for daily essentials rises during Ramadan. The move to ease imports has been taken to keep the supply of goods normal in the market and prices at a tolerable level during this period.

Under the instruction, the cash margin for opening LCs to import rice, wheat, onion, lentils, soybean and palm oil, sugar, chickpeas, peas, spices and dates can be set on the basis of the bank-customer relationship.

The central bank has also advised banks to give priority to importers in opening LCs, so that adequate supply of these products in the domestic market is ensured.

Bangladesh Bank said the instruction has been issued in the public interest under the powers given by Section 45 of the Bank Companies Act, 1991.

The instruction, effective immediately, will remain in force until 15 March 2027.