Dhaka, Bangladesh (BBN)- The central bank has lowered the all-in-cost ceiling on short-term trade finance to benchmark rate plus 3.0 per cent from 4.0 per cent, aiming to align borrowing costs with global market trends.
Under the revised rule, the borrowing cost for short-term permissible trade finance in foreign currencies will now be capped at a maximum of 3.0 per cent per annum over benchmark rates such as SOFR and Euribor, depending on the currency involved, according to a Bangladesh Bank (BB) notification issued on Monday.
Officials said the latest move reflects recent shifts in global interest rates and is intended to facilitate cheaper financing for both importers and exporters.
“The new ceiling is not limited to import financing alone. It will also apply to the discounting of usance export bills and early payments against exports conducted under open account credit terms, as outlined in previous foreign exchange circulars,” a senior BB official noted.
Market insiders viewed the reduction as a positive step for trade facilitation, particularly for exporters reliant on short-term financing to manage working capital needs.
They said the lower ceiling is expected to reduce financing pressure on businesses while maintaining consistency with international benchmark rates.
BBN/SSR/AD