The central bank allows authorised dealer (AD) banks to charge borrowers additional interest not exceeding 1.0 per cent annually for loans under the export development fund (EDF).
The new directive is for the interim period between 'import payments from sources of ADs' and 'receipts of refinancing from EDF'.
The Bangladesh Bank (BB) issued a circular to this end on Tuesday.
As usual, ADs will be charged by the BB at 1.0 per cent per annum against its refinancing from the EDF.
The ongoing export trend creates a huge demand for input procurements, leading to pressure on EDF loans.
The ADs can borrow US dollar funds from the EDF against their foreign currency loans to manufacturers and exporters for input procurements.
The cost of EDF loans for ultimate borrowers is 2.0 per cent per annum as per an FE circular in April 2020.
Foreign exchange policy department issued the circular, signed by its general manager Kazi Rafiqul Hassan.
