Exporters given more time to collect proceeds

Bangladesh Bank yesterday further extended the deadline for export proceeds repatriation in a bid to help entrepreneurs withstand the Covid-19 fallout.

Exporters will now get seven months to bring their export earnings until December this year, according to a central bank notice.

In March last year, exporters were allowed to fetch their export proceeds within seven months from the date of shipment instead of the previous four months.

The facility is scheduled to expire this month.

The repayment period for the back-to-back letters of credit opened under suppliers' and buyers' credit was earlier extended to one year from six months. This means importers can pay back the loans within a year against imported goods.

The support, set to expire this month, has been extended until December as well.

Buyers' credit refers to the finance for the payment of imports arranged by the importer from a financial institution outside the country.

Suppliers' credit is the credit extended directly by the overseas supplier for imports instead of a bank or financial institution.

In March last year, the central bank extended the repayment period for loans under the export development fund (EDF) to six months from three months.

Exporters will enjoy the support until December. The deadline of the facility was due to expire this month.

Bangladesh allowed exporters to receive funds from the EDF to adjust their loans under the suppliers' and buyers' credit facilities. The support will also continue until December.

The central bank has extended the policy support as economic activities are yet to gain momentum following the pandemic-induced slowdown, a Bangladesh Bank official said.

In addition, some European countries, which are major destinations for the country's exports, are also yet to regain their business momentum.

Each member of the Bangladesh Garment Manufacturers and Exporters Association and the Bangladesh Textile Mills Association will be allowed to enjoy a maximum of $30 million in loans from the EDF.

They earlier enjoyed a maximum of $25 million but the central bank increased the ceiling soon after Covid-19 had arrived in Bangladesh.