As Ramadan approaches, demand for essential food items rises, putting pressure on household budgets and raising concerns over adequate supplies and affordable prices.
Against this backdrop, Bangladesh Bank has eased cash margin requirements for opening letters of credit (LCs) for 10 essential commodity categories ahead of the upcoming Ramadan, aiming to facilitate imports, ensure adequate supplies and keep prices of daily necessities affordable.
In a circular issued on Sunday, the central bank instructed all scheduled banks to maintain cash margins at the minimum possible levels, considering banker-customer relationships, for imports of rice, wheat flour, onions, lentils, edible oil (soyabean oil and palm oil), sugar, chickpeas, peas, spices and dates.
The central bank also advised banks to give priority to opening LCs for these commodities to ensure uninterrupted supplies in the domestic market.
The directive, issued by the Banking Regulation and Policy Department-1 under Section 45 of the Bank Company Act, 1991, will take immediate effect and remain valid until 15 March 2027.
Importers generally require greater access to trade financing ahead of Ramadan to bring in adequate supplies and avoid potential disruptions in the domestic market as consumption of several food items traditionally increases during the fasting month.
The latest directive follows two earlier Bangladesh Bank circulars issued in September 2024 and November 2025 concerning cash margin requirements for imports of essential commodities.
Through a circular issued on 5 September 2024, the central bank imposed a 100 per cent cash margin requirement for opening LCs for certain imported commodities, requiring importers to deposit the full value of the LCs as cash security.
Later, on 11 November 2025, Bangladesh Bank relaxed the requirement for selected essential food imports ahead of Ramadan. It instructed banks to maintain cash margins at the minimum possible levels based on banker-customer relationships to facilitate imports. That relaxation remained effective until 31 March 2026.
With the latest circular, the central bank has again adopted a flexible approach to import financing, seeking to facilitate the timely arrival of essential commodities ahead of Ramadan.
The decision is expected to provide some relief to importers by reducing the immediate cash requirements associated with opening LCs. It may also help banks extend trade financing more efficiently to eligible importers.
