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Bangladesh Bank yesterday revised its policy for post-import financing (PIF) to ease the process for importers to get finance smoothly.
As per the previous guidelines on PIF released in June last year, Bangladesh Bank mentioned two sectors — essential commodities and industrial raw materials — where banks could finance importers.
In the latest guidelines, the central bank asked lenders in the country to finance to two more sectors, which are trading and agricultural items, alongside the previous two, according to a notice.
Importers will have to pay back loans given under the facility for raw materials within seven months instead of the six months set in previous guidelines.
Similarly, businesses which import agricultural products such as fertiliser, seed and pesticide will be allowed to repay their loans within six months.
Importers of trading items like electrical products will be permitted to refund their loans within four months.
However, Bangladesh Bank kept the repayment rules for essential commodities unchanged, meaning that importers still have to pay back their loans within three months.
Under the PIF, banks extend loans to importers to help them pay the cost of imported items within the stipulated time. This gives importers the opportunity to repay it after selling products.
Conventional banks earlier used to treat such financing as loans against trust receipts while Shariah-based banks called it Murabaha trust receipts.
The central bank also instructed banks not to facilitate PIF to borrowers who face overdue debt.
Lenders, however, will provide PIF to importers who are unable to repay their loans due to any unexpected adversity.
But no defaulter can receive any loan under as PIF.
In addition, such PIF facilities will not be applicable for inland letters of credit, which are opened and settled for local transactions.
(TDS)
