Written by The Banking Post
The Bangladesh Bank has introduced a new mechanism allowing exporters to obtain Taka liquidity by swapping their foreign currency holdings with commercial banks — a move aimed at easing short-term cash flow pressure in the export sector.
According to a circular issued on Monday, authorised dealer (AD) banks can now enter into Taka-foreign currency swap arrangements with exporters against balances held in their 30-day pools and Exporters’ Retention Quota (ERQ) accounts.
Under the arrangement, exporters can conduct a spot purchase of foreign currency against Taka, with a simultaneous forward reversal at an agreed rate and maturity. The tenor of such swaps must not exceed the expected utilisation date of ERQ balances and is capped at 30 days for funds in 30-day pools. All settlements will occur upon maturity.
The central bank noted that swap points can be determined based on market-reflective or cost-based interest differentials between the two currencies. Importantly, these swaps will not be considered as loans or financing facilities extended by AD banks.
The Taka liquidity obtained under this scheme must be used strictly for legitimate working capital needs related to export operations and cannot be diverted for speculative purposes.
Industry insiders believe the initiative will help exporters manage liquidity more efficiently without relying on conventional Taka-denominated export financing. It is also expected to encourage broader use of market-based foreign exchange derivatives for liquidity management.
