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The Bangladesh Bank recently authorized garment exporting joint ventures operating in the country’s export processing zones (EPZs) to take out loans from the bank’s Export Development Fund (EDF). The central bank issued a circular in this regard, claiming that EDF loans would be eligible against back-to-back import letters of credit for purchases of inputs by EPZ joint ventures producing clothing for export.

Previously, these loans were only allowed for domestic entrepreneurs in EPZs for the purchase of inputs under the back-to-back arrangement.

The facility has been extended to help entities offset the financial crisis induced by COVID-19, according to Bangladesh media.

Currently, the BB provides funds from its EDF at an interest rate of 1.75%. The interest rate on EDF loans will be maintained until March 31, 2021.

In April 2021, the central bank also increased the size of the EDF to $ 5 billion from $ 3.5 billion to support exporters after the coronavirus outbreak.

Fibre2Fashion Information Office (DS)

The Bangladesh Bank has authorized garment-exporting joint ventures operating in the country’s export processing zones (EPZs) to take out loans from the bank’s Export Development Fund (EDF). In a circular, he said EDF loans would be eligible against back-to-back import letters of credit for purchases of inputs by garment sector joint ventures in EPZs.