Foreign Exchange

Foreign trade financing is an integral part of banking business. Documentary Credit (also called letters of credit or “L/Cs”) is the key player in the foreign exchange business. With the globalization of economies international trade has become quite competitive. Timely payment for exports and quicker delivery of goods is, therefore, a pre-requisite for successful international trade operations. Growing complexity of international trade, separation of commercial parties across the globe and operating in a totally unknown environment underlined the need for evolving a system that balances between the expectations of the seller and the buyer. Documentary Credit has emerged as a vital system of trade payment, and fulfilled the requisite commercial need. This system substantially reduces payment-related risks for both exporter and importer. Not surprisingly, therefore, the letter of credit is the classic form of international export payment, especially in trade between distant partners. The bank upon presentation makes payment, acceptance or negotiation of the credit by the seller of stipulated documents (e.g., bill of lading, invoice, and inspection certificate). UCBL, Local Office is playing is playing a very important role in Foreign Trade Financing.

FUNCTIONS OF FOREIGN EXCHANGE DEPARTMENT:

 L/C opening & L/C amendment
 Sanctioning PAD, LIM, LTR, Packing Credit
 Foreign Bill Purchase
 Local Bill Purchase
 Foreign Currency Account Maintaining
 Foreign Currency Remitting

The Foreign Exchange Department of UCBL Local Office is divided into two broad sections:

1. Foreign Exchange Import
2. Foreign Exchange Export
Foreign Remittance is clubbed under Foreign Exchange Import Section.
ORGANIZATIONAL STRUCTURE OF FOREIGN EXCHANGE DEPARTMENT:

IMPORT:

According to the Imports and Exports control Act, 1950, no person can indent, import or export any goods into Bangladesh except some exemption. In order to be an importer one should obtain IRC