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.