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Published : 15 Jul 2026, 10:11 PM
Bangladesh Bank has further relaxed foreign borrowing rules for wholly foreign-owned companies, allowing them to obtain overseas loans more easily from their parent companies, affiliated entities and shareholders.
The central bank issued a notification on Wednesday through its Foreign Exchange Investment Department and sent it to all authorised dealer banks.
Officials said the move is aimed at attracting more foreign investment to Bangladesh by enabling foreign-owned industrial and service companies to access overseas financing at lower cost.
According to the notification, the new facility applies to wholly foreign-owned manufacturing and service enterprises operating in Export Processing Zones (EPZs), Economic Zones (EZs), Hi-Tech Parks and other specialised zones, as well as those operating outside such zones.
New Borrowing Framework
For short-term loans with a maturity of less than one year, companies operating outside specialised zones may now obtain interest-free working capital loans without prior approval from Bangladesh Bank.
They may also borrow interest-bearing loans for business purposes, including the purchase of raw materials, at an all-in annual cost of up to 3 percent.
Such loans must be repaid in a single instalment at maturity and may be rolled over for a maximum of three years.
For medium-term borrowing of between one and five years, the central bank has allowed interest-free loans of up to $50 million for capital expenditure, including machinery, equipment and construction.
Companies may also obtain interest-bearing medium-term loans of up to $5 million.
Long-term loans with maturities exceeding five years will also be permitted. Where interest applies, the annual rate has been capped at 3 percent.
The notification also allows outstanding foreign loans to be converted into equity.
On Jul 13, Bangladesh Bank issued another notification allowing companies operating in specialised zones to obtain local currency loans against foreign currency deposits.
Previously, only companies maintaining Exporters' Retention Quota (ERQ) accounts were eligible for the facility.
The latest policy extends the benefit to foreign-owned companies operating foreign currency (FC) accounts in EPZs, private EPZs, Economic Zones and Hi-Tech Parks.
Under the arrangement, banks will provide local currency loans for one month against FC deposits, with borrowers paying the applicable local interest.
