DHAKA, June 7, 2026 (BSS) - Bangladesh Bank (BB) today launched a Taka 3,000 
crore export diversification refinance scheme aimed at strengthening 
production capacity and expanding the country's export base beyond the ready-
made garments (RMG) sector.

The Sustainable Finance Department of the central bank issued a circular in 
this regard, saying the scheme has been introduced to address product and 
market concentration risks arising from Bangladesh's heavy dependence on RMG 
exports and to support the development of high-potential export sectors.

According to the circular, the refinance fund will be formed from the excess 
liquidity of scheduled banks and will operate as a revolving fund. 

Bangladesh Bank will provide refinancing to participating financial 
institutions (PFIs) at an interest rate of 4 percent, while exporters will 
receive financing at a maximum rate of 7 percent. 

The tenure of the facility has been fixed at three years, including a grace 
period of up to six months, with interest calculated under the reducing 
balance method.

The central bank said the scheme is designed to enhance export 
competitiveness, increase foreign exchange earnings, improve the country's 
trade balance and create employment opportunities through the expansion of 
non-traditional export sectors.

Financing under the scheme will be available to industries identified as 
"Highest Priority" and "Special Development" sectors under the Export Policy 
2024-27. 

Preference will be given to exporters using locally sourced raw materials, 
while sectors such as jute and leather have been highlighted as key areas for 
export diversification.

The circular stipulates that exporters classified as loan defaulters in 
Credit Information Bureau (CIB) reports, businesses with overdue export 
proceeds and entities with a history of loan write-offs will not be eligible 
for financing under the scheme.

Banks and financial institutions willing to participate must sign a 
Participation Agreement with Bangladesh Bank's Sustainable Finance 
Department. 

Islamic banks will also be eligible to provide financing through Shariah-
compliant investment modes, subject to compliance with the scheme's pricing 
and tenure requirements.

To obtain refinancing, PFIs will have to submit applications for each 
disbursement within 90 days along with required documents, including demand 
promissory notes, letters of continuity, debit authority letters and updated 
CIB reports.

A minimum debt-equity ratio of 70:30 will be maintained for all investments 
financed under the facility.

The central bank has also introduced strict monitoring and accountability 
measures. PFIs will be required to submit quarterly reports within 15 days of 
the end of each quarter, while Bangladesh Bank will conduct regular 
inspections to ensure proper utilization of funds.

Under the penalty provisions, PFIs found providing false information or 
allowing misuse of funds will be charged a five percent penalty interest in 
addition to the normal refinance rate. 

The amount will be recovered directly from the institution's current account 
maintained with Bangladesh Bank.

The circular further states that if a borrower becomes classified as a 
defaulter, the concerned PFI must immediately inform the central bank. 

In such cases, Bangladesh Bank may recover the entire outstanding refinance 
amount from the institution's current account through a one-time deduction.

The scheme has been introduced under the powers conferred by Section 45 of 
the Bank Company Act, 1991, as amended in 2023, and has come into effect 
immediately.