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Asian Clearing Union includes JPY in currency basket

| Updated: January 20, 2018 13:34:12

Asian Clearing Union includes JPY in currency basket

Country's banks are now allowed to use Japanese yen (JPY), along with the US dollar and Euro, for settling payments under the Asian Clearing Union (ACU) mechanism, officials said Thursday.

The commercial banks have also been advised to resume transactions in Euro after suspension of nearly one and a half years for settlement of current account transactions among the ACU member countries.

Earlier on July 27 in 2016, Bangladesh Bank (BB) had asked the banks to suspend operations in 'ACU Euro' temporarily as the payment channel for processing such transactions has been suspended by some correspondents.

"Accordingly, 'JPY' has been incorporated as a settlement currency in ACU mechanism," the BB said in a notification.

The ACU has included JPY in its basket as third currency to boost business activities among its member countries through facilitating the payment system.

Officials said the decision was taken at an ACU board meeting held in Colombo on July 13 last year, with Indrajith Coomaraswamy, governor of the central bank of Sri Lanka, in the chair.

The ACU is an arrangement involving Bangladesh, Bhutan, India, Iran, Myanmar, Nepal, Pakistan, Sri Lanka and the Maldives, through which intra-regional transactions among the participating central banks are settled on a multilateral basis.

The union started off its operation in November 1975 to boost trade among the member-countries. Bangladesh and Myanmar joined the union as the sixth and seventh members in 1976 and 1977 respectively. Bhutan joined the ACU in December 1999 and the Maldives in January 2010.

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