Garment makers urge BB to ease conditions of inland bill purchase
Garment makers yesterday urged the central bank to ease the conditions of inland bill purchase (IBP) by commercial banks to help exporters meet the immediate demand for cash in their business operations.
The commercial banks now show reluctance in accepting the IBPs after the Hall-Mark loan scam last year. The Hall-Mark Group embezzled Tk 2,686 crore from a branch of state-owned Sonali Bank through forged documents.
IBP is a credit facility that takes place when a bank gives guarantee to its clients for purchase of goods and services from the local market.
The banks are required to check whether the physical exchange of goods took place between the parties concerned, according to Bangladesh Bank rules.
â€œWe are facing difficulties in export as the commercial banks are not accepting the IBPs,â€ said Shafiul Islam Mohiuddin, president of Bangladesh Garment Manufacturers and Exporters Association.
If a company indulges in corruption, the government should bring it to book, but the entire industry cannot suffer for a few companies, he said.
Mohiuddin talked with journalists after a meeting with BB Governor Atiur Rahman at the latter's office in Dhaka.
Leaders of Bangladesh Knitwear Manufacturers and Exporters Association, Bangladesh Textile Mills Association, and Bangladesh Association of Banks were present at the meeting.
Mohiuddin also urged the central bank to ease the conditions of loan rescheduling so that the companies do not become loan defaulters within a short period of non-repayment.
In line with the loan classification rules that came to effect in December last year, an ongoing loan operation will be classified in the event of non-repayment of any instalment within three months, instead of the previous six-month duration.
The garment makers also urged the central bank to take measures to reduce the banks' lending rates. However, the central bank officials did not make any comment after the meeting.