Dhaka, June 13 -- The central bank has asked banks to expedite the use of alternative trade finance mechanisms, signaling a gradual shift from the country's heavy reliance on traditional Letter of Credit (LC) arrangements.

Under the new framework, authorised dealer (AD) banks are permitted to facilitate a broader range of trade finance instruments.

These include advance payments, open account exports, and documentary collection methods such as Documents against Payment (DP) and Documents against Acceptance (DA), according to notification issued by the Bangladesh Bank (BB) on Thursday.

While reaffirming that LCs remain a valid and widely accepted instrument, the central bank acknowledged the growing importance of complementary tools suc...