Bangladesh goes for digitising trade processing to modernise trans-border trading operations, ending hassles of manual documentation.
To this end, the central bank launched a pilot framework to enable digital processing of trade documents under documentary collections and letters of credit (LCs).
The framework will allow electronic submission, transmission and verification of trade documents across approved international trade corridors, according to a notification issued Wednesday by the Bangladesh Bank (BB).
The latest mechanism covers both export and import transactions governed by Uniform Rules for Collections (URC), Uniform Customs and Practice for Documentary Credits (UCP) and their electronic versions (eURC and eUCP).
Central bank officials say the framework introduces the use of Electronic Transferable Records (ETRs) as legally reliable alternatives to paper documents, subject to compliance with applicable standards.
It emphasizes "interoperability, technology neutrality, data privacy, and decentralized verification using secure digital mechanisms", they add.
Under the framework, authorised dealer (AD) banks need to seek BB approval to participate in the pilot by specifying trade corridors, counterparties, transaction types, and technology arrangements.
The system will support electronic handling of documents such as invoices, transport documents, and draft.
While electronic processing will be encouraged, AD banks may still require physical documents in jurisdictions where digital records are not legally recognised, the officials say, adding that the framework also mandates strong security features, including encryption, authentication, and audit trails.
"The piloting will be implemented in phases, with future expansion depending on performance and regulatory assessment," says the central bank notification.
Bankers and industry insiders believe the latest regulatory initiative will enhance efficiency, transparency and resilience of the country's trade- finance ecosystem while reducing processing time and operational costs in cross-border trade.
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