Bangladesh Bank, the central bank of Bangladesh has reduced interest rates on loans under the Export Development Fund (EDF) from 2.00% to 1.75% to help exporters to recover from pandemic-related disruptions. Such an interest rate on loans under the EDF will continue until March 31, 2021, according to a notification, issued by the Bangladesh Bank (BB) on 28.10.2020.
The interest rate for Authorised dealer (AD) banks was also reduced from 1.00% to 0.75% to get the EDF fund i.e. Authorised dealer’s spread will remain unchanged.
Besides, The central bank has enhanced the size of the EDF fund from $3.5 billion to $5.00 billion. EDF financing is allowed for input procurements against import and procurement in foreign exchange by manufacturers producing final output for direct and indirect exports.
The EDF loans are payable by the banks upon receipt of export proceeds within 180 days from the date of disbursement, extendable by the BB up to 270 days in case of a longer period for the repatriation of export income.
