Dhaka, Bangladesh (BBN) – The central bank of Bangladesh has asked the commercial banks for taking necessary measures to accelerate repatriation of their export proceeds to help meet the growing demand for foreign exchange in the market.
“The central bank has asked the commercial banks to take necessary measures to gear up repatriation of export proceeds that are remaining outstanding and overdue,” a senior official of the Bangladesh Bank (BB) said.
Besides, the commercial banks have been advised to comply strictly with regulatory instructions about executing export transactions to realize export proceeds within the prescribed period.
The central bank has taken the latest move against the backdrop of a big gap between export shipments and receipts, involving around US$2.0 billion, the BB official added.
It has issued a circular in this connection recently and asked the commercial banks for taking effective measures to expedite realisation of their export proceeds.
“It is, however, observed from the recent trend about realisation of export proceeds that the authorised foreign exchange dealer-banks, officially known as authorised dealers (Ads), are not exercising due diligence about execution of export transactions, resulting in a rise of credit on trading account, exerting undue pressure on foreign exchange market of the country,” the circular said.
It is not irregularity, the BB official said, adding that the existing Foreign Exchange Regulation Act allows up to four months’ of period for repatriation of export proceeds.
If the receipt of the full proceeds of any shipment is delayed beyond this period without a special or general authorisation from the BB, an exporter is liable to action under the Act.
However, collection of export bills payable at sight should normally take not more than a month under due process, the central bank official added.
For delays in repatriation or non-realisation of export proceeds, exporters and the authorised dealer-banks and the export firms are subject to punitive actions under the Foreign Exchange Regulation Act, 1947.
In their own interest, both exporters and banks should be alert about ensuring timely repatriation of export proceeds under the provisions of the Act.
Sometimes foreign buyers demand more discount after shipment of goods, or raise questions about the documents, often leading to delays in payment of export bills, bankers said.
BBN/SSR/AD-14July11-11:14 pm (BST)
