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Bangla RMG units to get loans for COVID safety measures

Nov '20
Pic: Shutterstock
Pic: Shutterstock
Readymade garment (RMG) factories in Bangladesh will get low-cost funds up to Tk 30 crore for investment in improving their workers' safety to overcome the crisis induced by the COVID-19 pandemic. The pre-finance credit facility is offered to eligible factories under social upgradation aiming at improving the safety, health and hygiene of workers and workplace environment, according to a circular issued by the Bangladesh Bank.

RMG owners will get the fund under the government’s ‘Programme to Support Safety Retrofits and Environmental Upgrades in the Bangladeshi Readymade Garments Sector Project (SREUP)’.

The fund was constituted in March last year with a corpus of $17 million sponsored by Agence Française de Développement (AFD). Its initial objective was to provide funds to RMG factories for safety retrofits and environmental upgradation.

The maximum limit for each factory is Tk10 crore or equivalent of €1 million at an interest rate of 7 per cent, according to SREUP fund guidelines. The ceiling may be extended up to Tk30 crore or equivalent of €3 million in case of major environmental upgradation or any other duly justified and documented case.

Borrowers will get loans usually for three to five years, which may be extended up to seven years.

Fibre2Fashion News Desk (DS)

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