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The Bangladesh Bank recently allowed joint venture (JV) apparel exporting companies operating in the country’s export processing zones (EPZs) to take loans from the bank’s Export Development Fund (EDF). The central bank issued a circular in this regard, saying EDF loans would be admissible against back-to-back import letters of credit for input procurements by EPZs’ JVs producing garments for export.
Earlier, such loans were only allowed for domestic entrepreneurs in the EPZs for input procurements under the back-to-back arrangement.
The facility was extended to help the entities offset the financial crisis induced by COVID-19, according to Bangladesh media reports.
At present, the BB grants funds from its EDF at the rate of 1.75 per cent interest. The interest rate on loans under the EDF will continue till March 31, 2021.
In April, 2021 the central bank also enhanced the EDF size to $5 billion from $3.5 billion with a view supporting the exporters following the outbreak of coronavirus.
Fibre2Fashion News Desk (DS)
The Bangladesh Bank has allowed joint venture (JV) apparel exporting companies operating in the country's export processing zones (EPZs) to take loans from the bank's Export Development Fund (EDF). In a circular, it said saying EDF loans would be admissible against back-to-back import letters of credit for input procurements by garment sector JVs in EPZs.