The Bangladesh Bank announced that for another six months, the exporters of textiles and garments will continue enjoying the increased credit cap under the Export Development Fund (EDF). The facility will be open for service until 30 June 2021 to representatives of the Factories for Producers and Exporters in Bangladesh (BGMEA) and the Factories of the Bangladesh Garment Mills (BTMA).
As part of its attempts to counter the coronavirus pandemic economic slowdown, in May last year the central bank increased its loan cap to 30 million dollars from 25 million dollars for the remainder of the year for the members of BGMEA and BTMA, under the Fund. On behalf of exporters associated to the two organizations, the central bank took the decision. In the coming months, the announcement would fuel exports.
EDF financing is enhanced to allow producers to buy raw materials in the form of back-to-back credit letters. This encourages them to manufacture export-oriented goods. The central bank increased the fund by 1,5 billion to 5 billion dollars after the pandemic, to safeguard exporters as exports crashed as a result of the global downturn. The BB has reduced the rate of interest on the loans.