B Mirror Report: Bangladesh Bank has issued a new circular aimed at accelerating and digitizing the disbursement of inward remittances, marking a major step toward improving efficiency in the country’s foreign exchange operations.

The central bank’s Foreign Exchange Policy Department announced the revised instructions today, directing Authorized Dealers (ADs), mainly commercial banks, to adopt faster processing systems and digital platforms for handling incoming cross-border payments.

Under the new guidelines, banks must ensure swift crediting of remittances by implementing Straight-Through Processing (STP) mechanisms. Inward remittances received during official banking hours must be credited to beneficiaries’ accounts on the same working day, while payments received after hours or on a recurring basis must be credited by the following business day.

To avoid unnecessary delays, banks are now allowed to credit customer accounts even if certain documents or verifications are still pending, provided that essential payment details are available. Any remaining compliance requirements may be completed through post-credit monitoring.

As part of its digital transformation drive, Bangladesh Bank has decided to withdraw the use of Form-C and Form-C (ICT). Instead, ADs must set up secure digital portals through which customers can submit required information and documents electronically, track transaction progress, and receive digital acknowledgements. Until such systems are fully deployed, banks have been instructed to rely on existing digital channels to collect remittance-related data.

The circular also requires banks to discontinue dependence on end-of-day statements. Instead, they must use intraday credit confirmations and reconcile nostro accounts at intervals of no more than 60 minutes to support faster settlement.

In addition, the central bank has made it mandatory to use the Unique End-to-End Transaction Reference (UETR) for all inward remittances. This reference must remain intact throughout domestic interbank transfers to ensure complete traceability until the funds reach the final recipient.

While prioritising speed, the new framework maintains strict compliance standards. Pre-credit checks will still apply to high-risk transactions, including those involving new or inactive customers, remittances from high-risk countries, or payments flagged by sanctions or monitoring systems.

In such cases, banks must still ensure prompt handling, with final settlement required within a maximum of three business days.

Bangladesh Bank has allowed banks time until March 31, 2026, to fully implement the new systems. During this transition period, ADs are expected to establish STP processes, digital submission platforms, and enhanced reconciliation mechanisms to meet the revised requirements.