BB clips facilities for firms missing import deadlines

Bangladesh Bank yesterday asked banks to stop providing all forms of import facilities to businesses that failed to bring in imports within four months of the allowed timeframe.

The businesses will not be allowed to import any products through advance payment, sales contact and letter of credit (LCs), according to a central bank notice sent out to all banks yesterday.

The instructions as a whole are nothing new but the central bank got to know of allegations that some lenders have helped the errant businesses go for imports by way of using sales contact and advance payment.

For this reason the notice has been issued to warn and give a clarification to lenders to this end, said a central bank official. The initiative will also establish discipline in the financial sector.

The central bank will take action against banks if businesses are allowed to continue to violate its instruction, the Bangladesh Bank official said. The BB is monitoring the export and import system through using its electronic dashboard.