What Is an LCA Form? The Letter of Credit Authorisation Your Bank Registers Before an Import

When a first-time importer walks into the bank to open a letter of credit for a China shipment, the first thing the trade desk asks for is not the LC application — it is a completed and registered LCA form. Many buyers have never heard of it, assume it is a formality the bank fills in, and then lose a week when it turns out to be the document that governs whether the import can legally proceed at all. This is what the Letter of Credit Authorisation form does, why it exists, and how to fill it so it does not come back for correction.

What the LCA form actually authorises

The LCA form — Letter of Credit Authorisation form, often shortened to LCAF — is the instrument through which an Authorised Dealer bank permits foreign-exchange payment against a specific import. Bangladesh runs a managed foreign-exchange regime: every dollar that leaves the country for an import has to be traceable to an approved transaction. The LCA form is where that approval is recorded at the point of entry into the system. It is registered against your IRC in Bangladesh Bank’s online import monitoring system before the LC is opened, and it carries a registration number that then follows the consignment all the way to the bill of entry.

In other words, the LC is the payment mechanism between banks; the LCA form is the country’s permission for that payment to happen. Even some imports that do not use an LC — certain advance-payment or collection-basis imports — still need an LCA form registered first.

What information goes on it

• Importer name, address, IRC number and category, TIN and BIN
• Full description of the goods with the correct HS code
• Quantity, unit price and total CFR or CIF value in foreign currency
• Country of origin and country of shipment
• The Authorised Dealer bank and branch handling the transaction
• Source of financing — own funds, supplier’s credit, or a foreign loan or grant line
• Whether the import is commercial, industrial or for a specific project

The HS code and description on the LCA form must match what the supplier will put on the commercial invoice and what your C&F agent will declare in ASYCUDA. A mismatch here is one of the most common reasons a bill of entry gets queried, because customs cross-references the declared classification against the registered LCA.

Validity and the shipment window

An LCA form is not open-ended. Once registered it is valid for a defined period within which shipment must take place, and the window is longer for capital machinery and industrial spares than for general commercial goods. If your supplier’s lead time plus sea transit is long — a made-to-order machine, for instance — check the current validity period against your realistic production and shipping timeline before you register, so the form does not expire mid-production. Extensions are possible but need a fresh application and a reason.

LCA form, IMP form and the payment trail

The LCA form opens the transaction; the IMP form closes it. When the bank actually remits payment to the Chinese supplier, it reports that outward remittance to Bangladesh Bank on an IMP form, quoting the same LCA registration number. Customs, separately, transmits the bill of entry data. Bangladesh Bank’s system then reconciles three things: money went out on the IMP form, goods came in on the bill of entry, and both trace back to one registered LCA form. If the goods never arrive against a remittance, that is an open item the bank has to explain, which is why banks are strict about the LCA form being correct from the start. See our note on how TT payments are reported for the remittance side.

Common mistakes that send it back

• Value stated CIF when the contract is FOB, or vice versa — the Incoterm and the value basis must agree.
• HS code guessed rather than confirmed, then corrected later, which forces an amendment and can delay the LC.
• Description too vague — “machinery parts” instead of the actual item — which customs will not accept at assessment.
• IRC renewal lapsed at the moment of registration; the system checks IRC status live.
• Financing source wrong — ticking “own funds” when a supplier credit is involved changes the reporting.

Where it fits, and who prepares it

In practice the bank’s trade desk prepares the LCA form with you, but the responsibility for the content is yours, and the content has to be consistent with the proforma invoice, the eventual commercial invoice, the packing list and the bill of lading. The cleanest way to run it is to lock the proforma invoice with your supplier first — final HS code, final Incoterm, final value — and build the LCA form from that single source. For the documents it has to line up with, see essential import documents explained, how an LC works, and how the USD-BDT rate affects the value you register.

LCA form for cash and advance-payment imports

The name says letter of credit, but the requirement is wider. Where the rules allow payment by advance remittance or on a collection basis instead of an LC, the Authorised Dealer bank still registers an LCA form first, because the country’s foreign-exchange monitoring needs the transaction in the system before money moves. If you have negotiated a deposit-and-balance TT deal with a Chinese supplier, do not assume the paperwork is lighter — ask the bank to register the LCA form before you send the first instalment, or the remittance can be held.

Amendments: what you can change and what forces a new form

Small corrections — a tightened description, a minor quantity change, a shipment-date extension within limits — are handled as amendments to the registered LCA form, usually quickly. Bigger changes reset the process: switching the HS code to a different tariff line, changing the country of origin, moving the value up materially, or changing the financing source generally means a fresh registration, not an amendment. This is why it pays to lock the proforma invoice hard before registering: every post-registration change costs days.

How the LCA form links to your customs assessment

At the bill-of-entry stage, customs pulls the registered LCA form and checks the declared goods against it: HS code, description, quantity, value and origin should all reconcile. If your agent declares a classification that differs from the LCA form, or a value that is lower, the assessing officer has grounds to query the entry and may refer it for valuation review. Keeping the LCA form, the commercial invoice, the packing list and the ASYCUDA declaration all describing the same goods the same way is the single most effective thing you can do to get a clean, fast assessment. Treat the proforma invoice as the master and build every downstream document from it.

A quick pre-registration checklist

• Proforma invoice finalised and signed — description, HS code, Incoterm and value all locked.
• IRC renewed and active in the system on the day of registration.
• HS code confirmed against the tariff, not guessed.
• Value basis on the form matches the Incoterm on the contract (do not register CIF against an FOB deal).
• Realistic shipment date chosen against the supplier’s lead time plus sea transit, with the validity window in mind.
• Financing source ticked correctly — own funds, supplier credit or a loan or grant line.

Getting these six right at registration avoids almost every amendment, and an amendment on a busy trade desk can cost the days you were trying to save.

DE International handles China sourcing, inspection, freight and Bangladesh customs clearance as one service, and our C&F desk deals with CCI&E, bank and NBR paperwork every working day. Tell us your product and target volume and we will map the exact permits, forms and duty lines your consignment needs — talk to our team, review what we do, use our China sourcing & buying agent service, or browse the shop.