Your bank issues the import permit — not the National Bank, and not customs. Since July 2024 any bank can approve any amount, but the foreign-currency queue has not disappeared. It moved from the National Bank to the commercial banks.
The change that matters most: since 29 May 2026, franco valuta is no longer open to everyone. Directive FVD/01/2026 permits only a defined list, and an ordinary trader is outside it. Most of the guidance still online predates this.
Bank charges are capped at 4%. Advance payments are capped at USD 50,000. A permit is valid for 120 days.
What the 2024 float actually changed
On 29 July 2024 the National Bank of Ethiopia issued Directive FXD/01/2024 and floated the birr. For importers, four things went away:
- The FX allocation waiting list and the priority categories that governed it
- The requirement to surrender foreign exchange to the NBE
- The minimum-price list banks used to validate proforma invoices
- The import ban on a long list of product categories
Two articles carry most of the weight. Article 3.2 states that the directive "authorizes all foreign exchange purchases and cross-border payments for current account transactions unless explicitly stated otherwise" — a permissive default, replacing a restrictive one. Article 8.1.1 mandates that "Authorized Banks are mandated to provide import permits for the import of goods of any value."
That last phrase matters. Your import permit comes from your commercial bank. Not from the National Bank, not from Customs. If someone tells you they can expedite a permit through a central authority, they are describing a system that no longer exists.
The queue did not disappear — it moved
This is the single most important thing to understand, and the thing most post-float coverage skips.
The legal queue is gone. The practical one is not. Allocation simply moved from a central committee down to individual banks, each managing its own foreign currency position.
The IMF's 2026 Ethiopia country report puts FX backlogs at banks at around USD 1.4 billion as of end-April 2026. The parallel market spread has fluctuated between 10 and 20 per cent since October 2025, sitting near 11 per cent in late May. The report also notes that banks "continue to cluster their bids" — meaning limited price competition and a degree of discretion in who gets served.
So the honest framing is this: the paperwork is now days to weeks. Getting the actual dollars is the variable. It depends on your bank's foreign currency position, your relationship with them, and your sector. Anyone quoting you a confident turnaround time either has inside knowledge of one specific bank's book or is guessing.
There has been movement on the supply side. NBE has run around two dozen FX auctions since August 2024 — the largest, in January 2026, supplied USD 500 million. In July 2026 the Monetary Policy Committee cut the export surrender requirement from 50% to 30% and reduced NBE's own FX commission from 2.5% to 1.5%, explicitly "to reduce import-related costs."
The July 2026 surrender and commission changes were announced in an MPC statement. At the time of writing no implementing directive had appeared on the NBE register, where the most recent published directive is dated 29 May 2026. Treat them as announced policy, not settled law.
The process, step by step
- Be properly licensed. Commercial registration, a business or import licence, and a TIN. Import-export licensing has been centralised to the federal Ministry of Trade and Regional Integration and moved onto the ETRADE portal, away from the regional trade bureaus. Check that your licence's activity codes actually cover the goods you intend to import — a mismatch here stops everything.
- Get your sector permits first, not last. If your goods need EFDA registration, a Ministry of Agriculture authorisation, or a certificate of conformity, obtain it before you approach the bank. Applying with a gap in the file is one of the commonest causes of delay. See our guide on what needs a permit.
- Get a proper proforma invoice. Full goods description, HS code, unit price, quantity, total, the Incoterm, and a validity date. Unit price times quantity must equal the total — banks reject on arithmetic. Agree a standard proforma template with your supplier once and reuse it.
- Apply to your bank. Each bank has its own foreign exchange application form for imports, plus a separate application for the payment instrument. Attach the licence, TIN, proforma, marine insurance (placed locally in practice) and any sector permits.
- The bank registers the application and issues the permit. It is valid for 120 calendar days from issue. The bank may extend it for good cause — the previous 30-day cap on extensions was removed in February 2026.
- Execute the payment through whichever instrument you have been approved for.
- Ship, then clear. Customs declaration to the Ethiopian Customs Commission and the tax cascade described in our duty guide.
Your four payment options
Letter of Credit
Your bank undertakes to pay the supplier against compliant documents. LC at sight — payment on presentation — is approved by the bank directly. LC on acceptance, where payment is deferred, historically required prior NBE approval.
Directive FXD/05/2026, effective 25 May 2026, relaxed that: banks may now approve LC-on-acceptance without NBE approval "for any institutions holding foreign currency account, and holders of retention accounts."
The relaxation is written for holders of foreign currency accounts and retention accounts. An ordinary importer without one of those appears to still need NBE approval for deferred payment. The directive does not say so negatively, so this is an inference from its scope — confirm your own position with your bank rather than assuming the relaxation covers you.
Cash Against Documents
The bank releases title documents to you against payment. Same structure as an LC: at sight is straightforward; on acceptance was liberalised by the same May 2026 directive, with the same limitation on who it covers.
Advance payment (telegraphic transfer)
You pay the supplier before shipment. The cap was raised from USD 5,000 to USD 50,000 per import transaction in May 2025 and, so far as we can establish, remains there. Above that figure you need an LC or CAD.
Worth saying plainly: advance payment gives you the least protection of any instrument. It is convenient for small orders and samples. It is not how you should be paying for a container from a supplier you have not worked with. Our supplier verification guide covers what to do instead.
Franco valuta
Importing goods for which no foreign exchange is drawn from the Ethiopian banking system — you fund it from currency held offshore. This one changed fundamentally three months ago, and it needs its own section.
Franco valuta: the May 2026 reform
Directive FVD/01/2026, effective 29 May 2026, repealed Article 8.1.3 of the 2024 foreign exchange directive and replaced open franco valuta with a closed eligibility list. Most guidance published before that date — which is most guidance online — is now wrong.
Under the old rule, franco valuta was broadly permissive: any goods not drawing on banking-system foreign exchange could come in, subject only to the normal customs, tax and health requirements. That is no longer the position.
Article 5 of the new directive sets out who may use the regime. The categories are, in substance:
- Licensed domestic investors in economic zones; diaspora investors; foreign investors
- Manufacturing and industrial enterprises with foreign ownership
- Foreign direct investment and diaspora traders
- Strategic development projects
- Owners of personal effects
- Religious institutions, government institutions and civil society organisations receiving grants
- The diplomatic corps
- International, continental and regional NGOs
Read that list for what is not on it. A conventional Ethiopian trading company — locally owned, importing goods to sell — does not obviously appear anywhere in it. Legal commentary on the reform reaches the same conclusion: purely local traders without a qualifying investment structure are effectively excluded from using franco valuta for commercial imports.
The directive also brings franco valuta into digital oversight: imports under it must be recorded in FEMoUS, NBE's foreign exchange monitoring platform, with Customs required to integrate. Penalties for misuse or false declaration run to fines, confiscation and criminal liability.
Some value thresholds appear in the procedures: personal effects up to USD 10,000 FOB, first-time returning residents' household goods up to USD 5,000 duty-free, promotional items USD 5,000, commercial samples USD 4,000.
If someone has told you that you can bring goods in franco valuta and you are an ordinary trading company, get that checked against Article 5 of FVD/01/2026 before you commit money to a shipment. Arriving at Customs with goods you are not eligible to import that way is a materially worse problem than a slow letter of credit.
What the bank charges
This is unusually well documented, because NBE capped it.
Since 26 May 2025 there is a hard 4% ceiling on all FX-related bank fees, covering imports of goods, service payments and cash purchases. Banks were explicitly told not to add supplementary charges for minor associated services. NBE publishes a live comparison table across roughly 32 banks.
How banks structure their 4% varies. Some split it across an LC opening commission, a service charge and a settlement charge; others levy it as a single fee. The total is what is capped.
Two further points on cost:
- NBE's own FX commission is 1.5%, cut from 2.5% in July 2026. The IMF's treatment suggests this sits alongside rather than inside the 4% bank cap — so budget for something in the region of 5.5% in total, and ask your bank to confirm.
- LC fees are now annualised and pro-rated to tenor. An NBE notice of 25 May 2026 requires that fees on letters of credit be "determined on an annualised basis and applied pro-rata in accordance with the tenor." A 90-day LC should therefore cost roughly a quarter of the annual rate, not a flat 4%. If your bank quotes flat, ask about the pro-rating.
Cash cover — the margin your bank requires you to deposit against the LC — is a commercial credit decision, not a published rule. Agree it before you finalise the proforma, because it determines how much birr you need tied up.
Why applications stall
| Cause | What to do about it |
|---|---|
| The bank has no foreign currency — by far the dominant cause | Ask for an indicative funding time in writing before you commit to a supplier. Consider a second banking relationship. |
| Proforma price materially below the ECC indicative price | Carry supplier quotations, volume-discount evidence and contract history. Do not under-declare to shrink the FX ask. |
| Proforma defects — no HS code, vague description, no Incoterm, expired validity, arithmetic that does not add up | Standardise a template with your supplier and reuse it. |
| Licence problems — unrenewed, wrong activity code, not migrated to ETRADE | Renew early. Confirm the licence covers your HS code. |
| Missing sector permits | Obtain before applying to the bank, not after. |
| Permit expiry at 120 days | Diarise it. Request an extension in good time — banks may extend for good cause. |
| Asking for deferred payment without an FCY or retention account | Use at-sight, or ask the bank about the NBE approval route. |
| Advance payment above USD 50,000 | Split the order or switch instrument. |
| Franco valuta without Article 5 eligibility | Check the category list. A plain trading company is likely outside it. |
What to ask your bank
Take these five questions to your relationship manager before you place an order. Written answers, if you can get them.
- "What is your current indicative funding time for an import of this size in this sector?" Not the paperwork time — the time until the currency is actually available.
- "What is your total charge, and does it include NBE's commission?" The 4% cap covers bank fees. Establish what sits on top.
- "Is my LC fee pro-rated to tenor?" Since May 2026 it should be.
- "What cash cover will you require?" This determines your working capital, and it is negotiable.
- "Is this item on the ECC indicative price list, and what is the reference price?" Better to find out now than after your proforma is challenged.
Between July 2024 and May 2026 there were five substantive rule changes in this area: the float, the advance payment cap, the fee cap, the indicative price rule, the deferred payment relaxation and the franco valuta reform. Anything you read without a date stamp on it should be assumed stale. This page carries one, and we will update it — but check NBE's directives register yourself for anything that matters to a live shipment.
- NBE Directive FXD/01/2024, 29 July 2024 — the float; Art. 3.2 and Art. 8.1.1
- NBE Directive FVD/01/2026 — Import on Franco Valuta, effective 29 May 2026
- NBE, Foreign Exchange Market Measures, 21 May 2025 — 4% fee cap, USD 50,000 advance limit
- NBE — Summary of banks' FX-related fees and charges (live comparison table)
- NBE press release, 25 January 2026 — ECC indicative prices
- IMF Country Report No. 26/174 — FX backlog and parallel spread data
- NBE Monetary Policy Committee, Meeting No. 7, 13 July 2026 — surrender and commission changes
- NBE directives register — foreign exchange management