The Bangladesh Bank has launched two important financing schemes to encourage and accelerate the sustainable growth and green manufacturing industry in the country: the Green Transformation Fund and the Technology Development Fund.
Green Transformation Fund
The Green Transformation Fund is a BDT5,000 crore refinancing scheme that provides long-term loans with a maximum interest rate of 5%. Factories can avail 70% of the costs of letters of credit against their required (machinery) imports as loans. A factory can take a maximum BDT200 crore loan from this fund.
Factories can use the loan for water efficiency in wet processing, water conservation and management, waste management, resource efficiency and recycling, renewable energy, energy efficiency, heat and temperature management, ventilation and wind flow efficiency, working environment improvement initiatives, and other areas.
Technology Development Fund
The Technology Development Fund is a BDT1,000 crore scheme that provides cheap loans to 100% export-oriented industries to upgrade the technologies they currently use. The tenure ranges from 3 years to 10 years, and the interest rate depends on the tenure, e.g. 5% for less than five years, 5.5% for between 5 years and less than 8 years, and 6% for more than 8 years to 10 years. Borrowers can also enjoy a maximum of 1 year grace period.
Under this scheme, exporters can get the loan for replacing outdated machinery, adopting technology for renewable energy, and upgrading of machinery used in business operations and waste management.