BB eases LC cash margin for essential imports ahead of Ramadan

Bangladesh Bank (BB) has instructed commercial banks to keep cash margins for opening letters of credit (LCs) at the minimum possible level for imports of 10 essential commodities ahead of the upcoming Ramadan.

The move aims to facilitate imports, ensure adequate supplies of essential goods in the domestic market and keep prices at tolerable levels during the fasting month.

In a circular issued on Sunday, the central bank directed the managing directors and chief executive officers of all scheduled banks to set the minimum cash margin based on the banker-customer relationship.

Banks have also been advised to give the highest priority to opening import LCs for these commodities to ensure uninterrupted supplies in the domestic market.

The 10 commodities covered by the directive are rice, wheat, onions, lentils, soybean and palm oil, sugar, chickpeas, peas, spices and dates.

The circular noted that demand for these essential food items usually rises during Ramadan. Facilitating imports through lower cash margins would help ensure adequate supplies and keep prices within the purchasing capacity of consumers, it said.

A cash margin is the portion of an LC’s value that an importer must deposit upfront with a bank. Keeping the margin at a minimum level reduces the initial financial burden on importers and helps facilitate imports.

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The latest directive takes effect immediately and will remain in force until 15 March 2027.

Earlier, on 5 September 2024, Bangladesh Bank instructed banks to maintain a 100% cash margin for opening LCs to import certain commodities.

Later, on 11 November 2025, the central bank relaxed the requirement, directing banks to keep cash margins for imports of selected essential commodities at the minimum possible level based on the banker-customer relationship ahead of Ramadan. That facility remained effective until 31 March 2026.