Bangladesh cuts loan interest rate for garment factory renovation

According to a report by Financial Express on August 30, the Ministry of Finance of Bangladesh has recently lowered the interest rate for garment factory renovation loans. The owners have applied for loans from the Remediation Fund (Remediation Fund) for the renovation of garment factories. The interest rates and service fees will be reduced from the previous 9-10 % reduced to 7%. Previously, funds worth more than Tk 3.18 billion were idle due to high capital costs. After this adjustment, the service fees charged by the Bangladesh Bank, the Bureau of Banks and Financial Institutions, and relevant commercial banks will also be adjusted from 1%, 0.9%, and 4% to 0.75%, 0.75%, and 3%. Rectification funds are provided by international organizations such as the Japan International Cooperation Agency (JICA) and the French Development Agency (AFD). It is reported that the interest rate and service fee of funds provided by JICA are less than 6%, and the interest rate and service fee of AFD do not exceed 7%. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) calls on the government to further reduce loan interest rates and service fees to 3-5% to meet the needs of small and medium-sized enterprise owners. Bangladesh lowers loan interest rate for garment factory renovation