Bangladesh Bank (BB) has issued comprehensive guidelines for scheduling banks to access its newly formed Tk 20,000 crore revolving pre-finance scheme, aimed at revitalising closed and capital-starved units in the country’s large industry and service sectors, particularly export-oriented ones.
The central bank's Banking Regulation and Policy Department-3 (BRPD-3) issued a circular for the managing directors and chief executive officers of all scheduled banks on Tuesday, detailing the operational modalities.
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According to the circular, the three-year revolving fund titled “Closed Industry and Service Sector Facilitation Pre-finance Scheme” will be sourced from the surplus liquidity of scheduled banks.
To participate in the scheme, interested banks must execute a "Participation Agreement" with the BRPD-3. After obtaining approval from their respective boards of directors, banks can apply for the pre-finance facility using a designated format, complete with necessary documentation, before disbursing the loans to end-borrowers.
The central bank stipulated that borrowers who are already availing working capital facilities from other BB re-finance or pre-finance schemes must undergo a thorough review of their requirements before a fresh application is submitted.
To ensure transparency and prevent financial irregularities, Bangladesh Bank has mandated that participating banks must collect specific declarations and reports from applicants alongside standard documentation.
These include a declaration from the borrower confirming that they have never been involved in money laundering, forgery, fund diversion, or loan misuse, a certification verifying the client’s production or service delivery capability, sales and revenue reports from the beneficiary entities, a commitment from banks to conduct quarterly factory inspections and submit inspection reports.
Reporting and Compliance
Participating banks will be required to submit quarterly statements on loan disbursement and recovery to Bangladesh Bank by the 10th of the month following the end of each quarter.