The Bangladesh Bank on Monday reduced the interest rate on a pre-shipment refinance scheme for export-oriented industries to 5% at customers’ level.
It has been decided to reduce the interest rates to achieve maximum growth in the export sector, said the central bank notice issued on the day.
Previously, the interest rate under the scheme was at 6%.
Banks will get the fund from the Bangladesh Bank at the rate of 2%, which was 3% before.
The instruction would be effective immediately.
Pre-shipment credit is a loan provided by a finance provider to a seller of goods and/or services for the sourcing, manufacture or conversion of raw materials or semi-finished goods into finished goods and/or services, which are then delivered to a buyer.
The central bank in April, last year launched a Tk5,000 crore pre-shipment refinance scheme for the export oriented industries as per a government announcement.
The BB said that the global economy had been observing unprecedented stagnancy due to the coronavirus pandemic.
As like other countries, Bangladesh’s exporters were also facing production fall and cancellation of export orders, hampering the export earnings, the BB added.
Prompted by the situation, they formed the Tk5,000-crore refinance fund to support the export oriented industries by the way of pre-shipment financing to expedite the country’s economy and export earnings, a senior BB official said.
Any export-oriented sector would be considered as eligible for the fund but the sanctioning loans would depend completely on the jurisdiction of the bank based on bank-customer relationship.
The tenure of the fund would be three-years and would be revolved during the period while the locally produced export-oriented industries would get funds for more than once for a maximum 1 year period.
