Monday, 6 December, 2021

StanChart launches pre-shipment fund for RMG sector

  • Staff Correspondent
  • 23 November, 2021 12:00 AM
  • Print news
StanChart launches pre-shipment
fund for RMG sector

Standard Chartered partners with large global Ready-Made Garments (RMG) buyers and suppliers recently launched first-of- its-kind pre-shipment finance programme supporting over 20,000 RMG workers.

Under the programme, the bank has disbursed 'USD Denominated Pre-Shipment Loans' to support the RMG industry face the challenges imposed by Covid-19, said a press release on Monday.

The unique Covid-19 response finance programme was designed through consultation with renowned buyers, enabling enhanced liquidity support for clients in a challenging environment.

The bank's clients can avail one-year liquidity support for payment of wages, utilities and other operational expenses under this programme, with a moratorium period of three months.

More than 20,000 workers received their multiple months salaries and festival bonuses on time through these loans.

As the Covid-19 pandemic struck in 2020, the apparel supply chain across  the world was disrupted. Retail stores shut down across the US, UK, Germany and other key markets, resulting in deferment and cancellation of orders which impacted RMG exporters in Bangladesh as well.

Standard Chartered remained focused on supporting the resilience of the Country's RMG sector, by enabling access to liquidity amidst this unprecedented scenario. The Bank leveraged its international network to collaborate with select large global buyers and swiftly arranged regulatory approvals to introduce a unique USD-denominated pre-shipment finance loan.

The facility enabled easy access to funds for salary and other operating expenses, USD-denominated facility low cost financing with natural hedge against currency volatility and extended tenor of one year which includes a three-month moratorium, giving the clients much needed flexibility in an uncertain operating environment.

Standard Chartered leveraged its long-standing relationship with many of  the top retailers and strong working relationship with the BGMEA and Bangladesh Bank to lead this collaborative effort to stand by the RMG industry with timely solutions.

Fakir Kamruzzaman Nahid, Managing Director of Fakir Fashions Ltd., a recipient of the facility said, "The impact of the pandemic on the lives, livelihoods and the overall economy cannot be overstated. At a time like this, the USD based Pre-Shipment Loans introduced by Standard Chartered offered us a chance to reduce our financial expenses as well as cement our longstanding relationship with our buyer."