The Bangladesh Bank on Thursday announced its decision to relax its mandate for commercial banks to pay upfront 70 percent of the government's annual cash incentive to exporters.
Now, the exporters will have to wait for the start of each quarter, when the government disburses the budgetary allocation, to avail the financial support.

In a circular sent to banks with approval to carry out foreign currency transactions, the central bank said that the yearly budget allocation for the advance payment would be disbursed by the Ministry of Finance in four equal instalments in the first week of each quarter.

Previously, the exporters would withdraw in advance 70 percent of the incentive from the approved commercial banks, which would be later repaid by the central bank after the government disbursed funds.
Officials of the related department of the Bangladesh Bank said due to irregular disbursement of government funds, the central bank was not able to pay back the amount in time. In response, the commercial banks would slap as high interest rate as 18 percent over the funds it disbursed to the exporters.

In a separate circular, the Bangladesh Bank announced that the time to apply for the government's incentive would be extended. According to the statement, the exporters will now be able to appeal for the incentive after shipping products listed on the Letter of Credit (LC) in different consignments.

Earlier, the deadline to apply for the cash incentive was 180 days from the day of the price repatriation. As a result, many exporters could not apply for the aid after shipping products of the same LC in different batches.