Bangladesh Bank has brought further flexibility in accessing foreign loans by foreign-owned companies operating in Bangladesh.

According to a circular issued by the central bank’s Foreign Exchange Policy Department (FEPD), the foreign-owned service companies can now avail short-term loans as working capital from their parent companies and shareholders for emergency business needs.

Earlier, such loans were applicable only for foreign-owned industrial enterprises engaged in manufacturing activities. No service or trading companies were allowed take such loans.


But the central bank’s new circular allows both the manufacturing and service companies to take such loans while the foreign-owned trading companies shall not come under this facility.

The central bank also said that such loan may be admissible in convertible foreign currencies maximum for six years from the date of inceptions of manufacturing and or service output activities with options to renew or extend the tenure within the applicable period.

“Borrowing enterprises may pay interest maximum at the rate of 3 percent per annum until further directives,” BB said adding that other relevant instructions regarding transactions shall remain unchanged.

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