Star Activity Report
Wed Apr 20 2022 12:00 AM Last updated on: Wed Apr 20 2022 1:06 AM
Clothing accounts for about 85% of Bangladesh’s total exports. The Bangladesh Bank said the current export trend has created a huge demand for input supply, which has put pressure on loans from the export development fund. Picture: star
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Clothing accounts for about 85% of Bangladesh’s total exports. The Bangladesh Bank said the current export trend has created a huge demand for input supply, which has put pressure on loans from the export development fund. Picture: star
Banks have been instructed not to charge exporters more than 1 percent interest after disbursing funds from their own pocket and before being reimbursed by Bangladesh Bank’s Export Development Fund (EDF).
The banking regulator has issued a notice in this regard, as many banks allegedly charged 7% interest rate to lenders illogically during this period, a central bank official said.
For all the latest news, follow the Daily Star’s Google News channel. Banks initially disburse funds to borrowers from their own sources and obtain reimbursement from the EDF.
The banks informed the central bank that they had charged a high interest rate to meet the cost of their funds before obtaining repayment, the BB official said.
According to central bank policy, exporters in the manufacturing sector are allowed to obtain the fund at 2% interest, from which lenders can benefit from 1% interest.
The BB said in its notice that the current export trend has created a huge demand for input supply, putting pressure on EDF loans, which now stand at $7 billion.
Imposing the cap will help exporters run their industries smoothly, the official said.
Export earnings hit $4.76 billion in March, the highest on record in a single month, posting 55% year-on-year growth.
In March, total revenue from shipping goods abroad rose 33.4% year-on-year to $38.6 billion in the nine months since July of the 2021-22 fiscal year.