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Pre-shipment credit refinancing scheme extended

Published : 01 Oct 2021 09:52 PM | Updated : 02 Oct 2021 03:39 PM

The central bank has extended the pre-shipment credit refinancing scheme to provide special loan assistance to the affected producers and exporters affected by the Corona outbreak.

Customers will be able to avail benefits under the scheme for three years, one year of that having passed already, according to the new instructions of Bangladesh Bank's Banking Regulations and Policy Department issued on Thursday.

Depending on the bank-customer relationship, the loan can be disbursed to a customer more than once in 3 years under the refinancing fund. Regardless of the term of the loan at the customer level, the participating banks will be refinanced by Bangladesh Bank for a maximum period of 180 days (6 months) which will be repayable with interest at the end of the term, said the central bank.

The new directive has given an opportunity to revive the damaged economy and bring dynamism to foreign exchange earnings in the pre-shipment credit sector to address the crisis caused by the novel Coronavirus.

A customer has been instructed to disburse the loan more than once for a maximum period of 1 (one) year, As the term of the fund has already passed one year, many consumers are not getting loan facility under the fund and their export activities are being hampered. 

The fund's goal of reviving the economy damaged by the Covid-19 and gaining momentum in foreign exchange earnings may be hampered, said the BB directive.

The central bank said in a circular that the directive was issued under the powers conferred by section 45 of the Banking Companies Act, 1991.

Earlier, on April 13, 2020, Bangladesh Bank provided a refinancing facility of Tk 5,000 crore with the aim of earning foreign exchange and bringing dynamism in the economy by continuing their export activities through pre-shipment export loan assistance. 

The interest rate at the customer level of the three-year pre-shipment credit refinancing scheme will be a maximum of 5 percent. The participating banks will get a refinancing facility from Bangladesh Bank at 2 percent interest.