Buyer's credit facility is a commendable step
Buyer's credit facility has been gaining popularity in the country. Under this credit facility, importers can take a short-term loan in foreign currencies to make payment to the exporters. Bangladesh Bank extended this facility for importers to facilitate the import of capital machinery and raw materials.
One of the good sides of this credit facility is its low interest rate. If the importers take a loan in the local currency, a staggering interest rate of 8-9 percent has to be paid. But in the case of loans in foreign currency, the interest rate is around 3.50-4.50 percent. However, due to the increased demand for loans in foreign currency, the demand for local currency is on the wane. There are also some misuses of this credit facility, which need to be addressed.