While Lodgment of the Import Documents

Immediately Upon receipt of import documents the L/C Opening Bank examines all the documents thoroughly to ensure that the terms and conditions as laid down in the Credit have been complied with. On Security if it is found that the documents drawn are in conformity with the terms of the credit, the bank lodges the documents in PAD/Bill of exchange and the following vouchers are passed-

Debit- PAD/BE A/C ......................................................... tk
(Converted the bill amount at B.C Rate prevailing on the day of lodgement)

Credit - H.O. A/C ............................................................. tk
(Converted the bill amount at T.T rate prevailing on that date & Dr. TRV is sent along with a atatement of the transaction)

Credit: - Exchange A/C .................................................... tk



Reversal of contra Liability Voucher

Debit- Bankers Liability for Acceptance on L/C ................................. Tk

Credit- Customers Liability for Acceptances on L/C ........................... Tk




While Retirement of the Import Documentss:

Immediately after the lodgement of the import documents the bank request the importer for retirement of the documents against payment of bill amount and other charges payable. The Importer places fund in his account and the bank passes following vouchers in retiring documents:


Debit - Margins on L/C account ................................................... Tk

Debit - Importers authorized account ........................................... Tk

Credit - PAD/BE account .........................................................................Tk

Credit - Income account interest on PAD/BE........................................... Tk

Credit - Admissible commission account................................................. Tk

Credit - Miscellaneous earning (if any) ................................................... Tk




Note: The issuance commission of the bank is charges quarterly for Credits from date of issuance date until date payment, Credit expiry or maturity of a deferred payment undertaking..

Post Import Financing Method

Importer very often requires financial support for releasing imported goods. Post import financing is an important part of a banks activities. At the end of import operation the bank finances the importer directly in two forms:-

1. Loan against Imported Merchandise (LIM): 

Such credit facility is allowed against pledge of imported goods. In this case bank clears the goods through its approved 'Clearing Agent' and store the same under its effective control. All relative expenses in connection with clearing of goods are debited to LIM account. In this case the banker has to obtain approval from the competent authority. Necessary charge documents are to be held with the bank for such credit.

2. Loan against Trust Receipt (LTR):

This sort of credit is extended to the importer against trust receipt. In this case unlike LIM, the imported goods remain in the custody of the importer. He is required to execute a stamped trust receipt in favour of the bank. Moreover, the bank retains collateral security for its safeguard. Necessary charge documents are also held with the bank against this type of credit.

3. Forced LMI:

  Upon receipt the shipping/import documents from the Negotiating Bank, the Opening Bank notified the importer about the documents and ask the importer to take delivery of import documents for releasing the goods. If the importer fails to respond within a reasonable time  time,the opening bank retires the bill by creation of forced LIM with approval of its competent authority. In such case the Banks create the goods through its approved 'Clearing Agent' and store the same under its effective control. All relevant expenses in connection with clearing of goods are debited to forced LIM account.

BOOK-KEEPING IN Import Operation:

Importer operation goes on through different stages and the importers bank has to accomplish different jobs in each stage. Therefore the banker makes different forms of book keeping and of course these include income and expenditure of the bank and the importer respectively. Here are some formations of book keeping usually the bankers in our country follow for importer operation:

While Opening L/C

Description	Debit	Credit
Importer's authorized Account Margi on L/C account Commision account Other imcome account (Postage/TT etc. Where applicable)	XXXXXX	XXXXX XXXXX XXXXX

Contra Liability Voucher:

Description	Debit	Credit
Customers Liability for Acceptance on L/C Bankers Liability for Acceptance on L/C	XXXXXX	XXXXX

It is important to mote that accounting procedure may differ from bank to bank. As such we have to follow the guidelines issued by our respective bank. Further we have to take in to account that the amount of margin is to be realized according to agreement made between the bank and the importer.

The margin agrees by the bank will depend upon various factors such as Bangladesh Bank stipulations, the creditworthiness of importer, nature of the commodity to be imported, etc.

IMPORT Payment Procedures

Import means purchase of foreign goods and or services. Hence it needs exchange of money and goods or services. The importer makes payment for the goods and or services he imports. import procedure differs with different means of payment. Different payment procedures are:


1. Cash in Advance:

Importer pays full, partial or progressive payment by a foreign DD, MT or TT. After receiving payment , exporter sends the goods and the transport receipt to the importer. Importer takes delivery of the goods from the transport company.


2. Open Account:

Exporter ships the goods and sends transport receipt to the importer. Importer takes delivery of the goods and makes payment by foreign DD, MT or TT. at some specified date.

3. Collection Methods:

Collection Methods are either clean or documentary. Again documentary collection is of two kinds:

                              a) Documents against payment.
                              b) Documents against Acceptance

In this method the exporter ships the goods and draws a draft/bill on the buyer. The exporter then submits the draft/bill (only or with documents) to the Remitting Bank for collection and the bank acknowledge it. The Remitting Bank sends the draft/bill (with or without documents) and a collection instruction letter to the Collecting Bank notifies the importer upon receipt of the draft. The title of the goods is released to the importer upon full payment or acceptance of the draft/bill.

4. Letter of Credit:

Letter of credit is well accepted and the most commonly used means of payment. It is an undertaking for payment. It is an undertaking for payment by the issuing Bank to the beneficiary, upon submission of some stipulated documents and fulfilling the terms and conditions mentioned in the letter of credit.