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Lesson 18 of 39 · Part E · Level 2 · Explained

Paying on time

Why a bank must pay import bills on the due date, the payment behaviour framework that helps it keep that promise, what to do about overdue accepted bills, and the monthly papers and statements that keep head office and Bangladesh Bank informed.

E-1E-2E-3E-4E-5

In Lesson 17, Buyer's credit and longer terms, Rakib learned the many polite ways an importer may pay later: supplier's credit, buyer's credit, and banks buying accepted bills early. By the end of it he knew a great deal about "later". This lesson is about the day "later" finally arrives.

On Sunday morning, Sadia, his team lead, puts a printout on his desk: the branch's accepted import bills falling due this week. Two names sit at the top. Lamia, who imports pharmaceutical raw materials in Dhaka, has a bill maturing on Tuesday. Fahim, who brings onions and machinery parts in through Benapole land port, has one due on Wednesday. Fahim has already phoned. "Can the bank pay a few days late? Onion prices fell, and so did my mood."

Rakib looks up. "It's only a few days. Who really gets hurt?"

"Good question," says Sadia. "Let's ask someone who looks at the whole country, not just one file." That afternoon the branch's monthly training has a guest speaker: Rozy, a development economist at a policy research institute. Rakib asks his question. Rozy smiles. "Think of the tea stall near your house. Pay on time, and the owner happily gives you credit next month. Pay late, and he starts asking for cash first, and maybe charges a little more. Foreign suppliers and banks think the same way about a country's banks. Every late payment makes the next deal a little harder and a little dearer, for everyone."

This lesson covers Part E of the import circular: paying import liabilities on time (E-1), the payment behaviour framework (E-2), overdue accepted bills (E-3), sending bills to head office (E-4) and the statements for Bangladesh Bank (E-5).

Para E-1

Payment of import liability

In plain words

E-1 is only two sentences long, but it carries a lot of weight.

The duty

  • ADs must pay their import liabilities as per their exposure or acceptance, on the due date or maturity.

In simple words: when a bank opens an LC or accepts a bill, it makes a promise. On the day the payment falls due, the bank pays. Not "soon". Not "after Eid". On the day.

The warning

  • Failure to settle import liabilities may lead to punitive actions by Bangladesh Bank.
  • The circular names one of them clearly: revocation of the AD licence. The AD licence is what lets a bank branch deal in foreign exchange, so this is about as serious as it gets.

E-1 doesn't list the other punitive actions, and it doesn't say which action follows which kind of failure. Its message is simple: paying on time is not a favour to the supplier. It is part of being an AD.

Notice whose duty this is. E-1 speaks to the AD, not the importer. It gives no exception for an importer who is short of money that week.

At the desk

Fahim's accepted bill for machinery parts matures on Wednesday, and he asks Rakib whether the bank could pay the supplier's bank a week later. Rakib checks with Sadia. "Our acceptance says Wednesday, so we pay on Wednesday," she says. "E-1 is about our promise, and it has no 'next week' button." Rakib calls Fahim to make sure his account is funded before the due date.

Key words
Import liability
What a bank owes for an import, for example under an LC it opened or a bill it accepted. It must be paid on the due date.
Acceptance
The buyer's signature on a usance bill of exchange, promising to pay it on the maturity date.
Maturity date
The day an accepted bill of exchange must be paid.
AD (Authorised Dealer)
A bank branch licensed by Bangladesh Bank to deal in foreign exchange.
Read the rule as written (Para E-1)

ADs shall make payment of import liabilities as per their exposure/acceptance on due date/maturity. Failure in settlement of import liability may result in punitive actions including revocation of AD license by Bangladesh Bank.

Source: Bangladesh Bank, FEPD-1 Circular No. 30, 13 August 2026, Part E, paragraph 1 (page 21). The original circular is the authority.

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Para E-2

Payment behavior framework for timely import payments

In plain words

E-1 says pay on time. E-2 says plan so that you can. It tells ADs to adhere strictly to their commitments on import payments, and sets out a payment behaviour framework in three steps:

  1. Credit lines first. Before issuing an LC, the AD must make sure appropriate credit lines are available for that importer.
  2. No credit facility? Then show the money. An LC for an importer without underlying credit facilities is subject to adequate cash flows and prospective fund arrangements to cover the import payment. In plain words: if the bank isn't lending, it must see where the money will come from. The circular doesn't put a number on "adequate".
  3. Usance needs a funder. Usance imports should be financed either through buyer's credit by offshore banking operations, or by the AD's own fund in terms of paragraph 4 of Part D. In Lesson 17, that paragraph (D-4) was about banks buying accepted usance bills early. E-2 points there and doesn't repeat the details.

The personal warning

E-2(2) reminds ADs that failing to settle payments on time is subject to punitive actions, including personal accountability of the officials responsible for the transactions. So it isn't only the bank's name on the line. The officer who handled the deal may have to answer too.

Think of a wedding caterer. A good one checks that the advance is in hand before buying 200 kg of rice, not while the guests are already sitting down.

At the desk

Lamia asks for a new LC for an active ingredient. She has no credit facility with the branch; she pays for her imports from her own funds. Rakib suggests opening it anyway, "since she always pays." Sadia first asks for Lamia's cash-flow figures and a clear plan for how this payment will be funded, as E-2(1)(b) expects. "And remember," she adds, "E-2 says the officials responsible can be held personally accountable. That means you and me."

Key words
Payment behaviour framework
The three steps in E-2 that help ADs keep their import payment promises: credit lines first, cash flow when there is no credit facility, and proper funding for usance imports.
Credit line
A credit facility a bank has approved for a customer, up to a set amount, which can back the customer's LCs.
Buyer's credit
Finance from a foreign lender, who pays the supplier on the importer's behalf; the importer repays the lender later.
Personal accountability
When an individual official, not only the bank, may have to answer for a failure.
Read the rule as written (Para E-2)

(1) ADs need to adhere strictly to their commitments with regard to import payments. Accordingly, ADs shall follow the payment behavior framework as outlined below:

(a) Before issuing LCs, ADs shall ensure appropriate credit lines available for the respective importers;

(b) Issuance of LCs on behalf of importers without underlying credit facilities is subject to adequate cash flows and prospective fund arrangements to cover import payments;

(c) Usance import should be financed through buyer's credit by offshore banking operations, or by the own fund of ADs in terms of paragraph 4 of Part-D.

(2) ADs are reminded to the effect that failure to settle payments on time is subject to punitive actions, including personal accountability to the officials responsible for the transactions.

Source: Bangladesh Bank, FEPD-1 Circular No. 30, 13 August 2026, Part E, paragraph 2 (page 21). The original circular is the authority.

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Para E-3

Payment of overdue accepted bills (foreign or local)

In plain words

Now the uncomfortable part: bills that have been accepted but are still unpaid after they fall due. E-3 calls them overdue accepted bills, and it covers both foreign and local ones.

Why it matters: E-3(a)

The circular gives two reasons. Non-payment of import bills on time tarnishes the image of the country's banking system. It also disrupts a conducive environment for foreign trade by increasing its cost. Rozy's tea stall again: one late customer, and prices creep up for everyone in the queue. So banks must take the following measures to get overdue accepted bills paid promptly.

The measures

  • (b) Review, then plan. Review the overdue accepted bills in detail and take a comprehensive action plan. The analysis should look at factors such as ongoing litigation, the presence of realisation clauses, and classification as large industrial enterprises. The circular names these factors but doesn't explain how each should shape the plan.
  • (c) Look branch by branch. Evaluate branch-wise performance during the review. Branches with a high volume of overdue unpaid accepted bills must be brought under special monitoring arrangements. The circular doesn't set a number for "high", or describe the monitoring.
  • (d) Bills in court. If a bill under litigation is not payable, the bank must inform the supplier's bank accordingly. Silence is not an option.
  • (e) Check before you report. Before submitting the monthly report on overdue accepted bills, verify the data through OIMS.

One overdue bill looks like a dripping tap. A whole bank of dripping taps empties the tank.

At the desk

In the monthly review, Rakib finds one of Fahim's accepted bills overdue: a court case with the supplier means the bill is not payable for now. "So we just wait for the judge?" he asks. Sadia shakes her head. "E-3(d) says we inform the supplier's bank. Then the case goes into our action plan, with the litigation noted." Rakib drafts the message the same day.

Key words
Overdue accepted bill
An import bill that has been accepted for payment on a set date but is still unpaid after that date. It may be foreign or local.
Litigation
A court case.
Special monitoring
Closer watching, under special arrangements, of a branch with a high volume of overdue unpaid accepted bills.
OIMS
Online Import Monitoring System.
Read the rule as written (Para E-3)

(a) Non-payment of import bills on time tarnishes the image of the country's banking system and disrupts a conducive environment for foreign trade by increasing its cost. Considering these issues, banks shall take the following measures to ensure prompt payment of overdue accepted bills (foreign or local):

(b) A comprehensive action plan must be taken after detailed review of overdue accepted bills (foreign or local), including analysis based on factors like ongoing litigation, presence of realization clauses, and classification as large industrial enterprises.

(c) Branch-wise performance should be evaluated during the review. Branches with a high volume of overdue unpaid accepted bills (foreign or local) must be brought under special monitoring arrangements.

(d) If any bill under litigation is not payable, the supplier’s bank must be informed accordingly.

(e) While submitting the monthly report on overdue accepted bills (foreign or local), data must be verified through the OIMS before submission.

Source: Bangladesh Bank, FEPD-1 Circular No. 30, 13 August 2026, Part E, paragraph 3 (page 21). The original circular is the authority.

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Para E-4

Documents to head offices/principal offices

In plain words

E-4 keeps head office in the picture.

  • Which bills: all bills, foreign or local, submitted to the AD branch.
  • Along with: the discrepancies and the details of payments made.
  • What to do: preserve them, and send them monthly to the relevant department at the head office or principal office.

Why bother? Head office can't fix what it can't see. E-3 asks banks to review overdue bills and judge branches one by one, and that review is only as good as what the branches send up. A bill hidden in a drawer helps nobody.

The circular doesn't name the "relevant department", give a day of the month for sending, or say whether originals or copies go. It simply says the bills are to be preserved and sent monthly.

At the desk

At month end, Rakib packs the month's import bills for head office, but quietly leaves out two with discrepancies, "to save the branch some embarrassment." Sadia puts them back in the file. "E-4 asks for all bills, with their discrepancies and payment details. Head office needs the full picture, not the flattering one."

Key words
Head office
A bank's main office, which reports for the bank as a whole, not branch by branch.
Discrepancy
A difference between the documents and the LC terms, or between the documents themselves. It can delay or stop payment.
Read the rule as written (Para E-4)

All bills (foreign or local) submitted to AD branch, along with discrepancies and details of payments made, shall be preserved and sent monthly to the relevant department at the head office/principal offices.

Source: Bangladesh Bank, FEPD-1 Circular No. 30, 13 August 2026, Part E, paragraph 4 (page 21). The original circular is the authority.

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Para E-5

Submission of statements

In plain words

E-5 is the last step: telling Bangladesh Bank. Banks must send statements on overdue accepted bills to FEOD, Bangladesh Bank, Head Office, by e-mail, following the instructions in Appendix-10.

The five monthly statements are:

  1. Summary statement of overdue accepted bills (Appendix-6)
  2. Statement of overdue accepted bills, Local payables (Appendix-7)
  3. Statement of overdue accepted bills, Foreign payables (Appendix-8)
  4. Statement of overdue accepted bills, Local receivables (Appendix-9)
  5. Bank-wise summary statement of local overdue accepted bills (Appendix-10)

A small puzzle: Appendix-10 appears twice. E-5 says it holds the instructions for sending, and it is also the fifth statement. This lesson doesn't cover the appendices themselves, so it can't say more.

Remember the link with E-3(e): the monthly report on overdue accepted bills must be verified through OIMS before it is submitted. Check first, then send. E-5 itself doesn't give a submission date.

At the desk

Sadia asks Rakib to prepare the branch's part of the monthly statement of overdue accepted bills for local receivables. Rakib opens the format in Appendix-9, fills it in, and checks the figures against OIMS. Only then does head office e-mail the bank's statements to FEOD.

Key words
FEOD
Foreign Exchange Operation Department of Bangladesh Bank. It considers requests such as extensions of the Bill of Entry time limit.
Summary statement
A short report that shows totals instead of listing every item in full.
Appendix
A section at the end of a circular that holds forms, formats or instructions.
Read the rule as written (Para E-5)

Banks are required to submit the following statements to FEOD, Bangladesh Bank, Head office regarding overdue accepted bills through e-mail complying with the instructions mentioned in Appendix-10:

(1) Monthly summary statement of overdue accepted bills (Appendix-6)

(2) Monthly statement of overdue accepted bills -Local payables (Appendix-7)

(3) Monthly statement of overdue accepted bills -Foreign payables (Appendix-8)

(4) Monthly statement of overdue accepted bills -Local receivables (Appendix-9)

(5) Monthly bank-wise summary statement of local overdue accepted bills (Appendix-10)

Source: Bangladesh Bank, FEPD-1 Circular No. 30, 13 August 2026, Part E, paragraph 5 (page 21). The original circular is the authority.

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Putting it together

So far: an AD must pay its import liabilities on the due date, or risk punitive action, including the loss of its AD licence. To keep that promise it checks credit lines before opening LCs, looks for real cash flow when there is no credit facility, funds usance imports properly, and knows its officials can be held personally accountable. Overdue accepted bills get a detailed review, an action plan and branch-by-branch monitoring; bills stuck in court are reported to the supplier's bank; all bills go to head office every month; and the monthly statements, checked through OIMS, go to FEOD by e-mail.

That completes Part E of the import room.

Next: Part F, on remittance for software imports through e-delivery, starts in Lesson 19, Software by e-delivery, tenders and export-funded imports.

Check yourself

30 questions, in 3 sets of up to 10. Nobody sees your answers but you.

Set 1 of 3

1. Under E-1, when must an AD pay its import liabilities?
2. Which punitive action does E-1 name?
3. To whom is the payment duty in E-1 addressed?
4. True or false: under E-1, failure to settle import liabilities may lead Bangladesh Bank to revoke a bank's AD licence.
5. Fahim's accepted bill matures on Wednesday, and he asks Rakib to pay the supplier's bank a week later because sales are slow. What should the branch do?
6. Under E-2(1)(a), what must an AD ensure before issuing an LC?
7. Under E-2(1)(b), what is an LC for an importer without underlying credit facilities subject to?
8. When usance imports are financed by an AD's own fund, which paragraph does E-2(1)(c) point to?
9. Under E-2(2), who may face personal accountability when payments are not settled on time?
10. True or false: E-2 lets an AD issue an LC for an importer without underlying credit facilities with no further checks.

Set 2 of 3

11. Lamia has no credit facility with the branch, and she asks for a new LC. Rakib wants to open it at once because she always pays. What should Sadia do first?
12. Rakib says, "If a bill goes unpaid, it's the bank's problem, not mine." What does E-2(2) say?
13. Lamia wants to import on 180-day usance terms. Which funding route fits E-2(1)(c)?
14. Which two harms does E-3(a) link to non-payment of import bills on time?
15. Which factors does E-3(b) name for analysing overdue accepted bills?
16. Under E-3(c), what should be evaluated during the review of overdue accepted bills?
17. What is the main aim of the measures in E-3?
18. True or false: E-3 covers overdue accepted bills, both foreign and local.
19. One of Fahim's accepted bills is under litigation and is not payable for now. What does E-3(d) require of the bank?
20. Sadia's bank finds in its review that one branch has a high volume of overdue unpaid accepted bills. What does E-3(c) require?

Set 3 of 3

21. Rakib has the monthly report on overdue accepted bills ready from the branch's own spreadsheet and wants to send it straight away. What should Sadia tell him?
22. Sadia's team is reviewing overdue accepted bills. One case is in court, one bill has a realisation clause, and one importer is a large industrial enterprise. What should the team do?
23. Under E-4, how often are the bills sent to the relevant department at the head office or principal office?
24. True or false: E-4 covers only foreign bills, not local ones.
25. At month end, Rakib wants to leave two discrepant bills out of the pack for head office. What does E-4 require?
26. To which office do banks send the statements on overdue accepted bills under E-5?
27. Which appendix is the monthly summary statement of overdue accepted bills?
28. Which appendix is the monthly statement of overdue accepted bills for foreign payables?
29. True or false: E-5 says the statements must be sent to Bangladesh Bank in hard copy by courier.
30. Sadia asks Rakib to prepare the monthly statement of overdue accepted bills for local receivables. Which format does E-5 point to?
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