Bangladesh Bank Launches Pilot Framework for Digital Trade Documents

Bangladesh Bank has introduced a pilot framework to digitize trade documents for export and import transactions with marking a major step toward modernizing the country's cross-border trade and finance operations.

The Foreign Exchange Policy Department issued a circular on Wednesday outlining the framework, aimed at improving efficiency, transparency and resilience by gradually replacing paper-based trade documents with secure electronic processes, reports BSS.

Under the pilot, the framework will cover transactions through documentary collections and letters of credit (LCs) across approved trade corridors. It applies to export and import transactions governed by international rules, including URC, eURC, UCP and eUCP.

The framework also enables Electronic Transferable Records (ETRs), allowing trade documents to be issued, transferred and managed digitally, while supporting trade finance involving electronic documentation within approved pilot arrangements.

According to the circular, the framework rests on five principles: interoperability between systems, technology neutrality, decentralized verification through cryptographic methods, data privacy protection and legal equivalence between electronic and paper documents.

To join the pilot, Authorised Dealer (AD) banks must obtain Bangladesh Bank's "concurrence in principle" by submitting details of proposed trade corridors, counterparty institutions, transaction types and risk management plans.

Banks can process electronic commercial invoices, transport documents including e-bills of lading and bills of exchange through secure digital platforms using digital signatures and authenticated interbank messaging. To protect document integrity, institutions must ensure record uniqueness, prevent unauthorized changes and maintain secure transmission via encryption, time-stamping and tamper-proof audit trails.

The pilot will roll out in phases, with wider adoption depending on its success and further regulatory review. This follows a January circular enabling secure electronic submission of export documents, part of the central bank's push to strengthen Bangladesh's digital trade ecosystem.