In a timely move to alleviate financial pressure on jute exporters, Bangladesh Bank has extended the deadline for applying for loan rescheduling. The decision comes as the country’s raw jute export sector, one of the nation’s key foreign currency earners, faces multiple challenges, including shipping delays, fluctuating raw material prices, and declining international market values.
In a directive issued on Sunday, the Banking Regulation and Policy Department instructed all commercial banks to implement the revised policy promptly. Under the updated guidelines, jute exporters can now submit applications for the rescheduling of defaulted loans until 30 June 2026, an extension from the previous deadline of 31 December 2025.
The policy specifies that for loans outstanding as of 31 December 2024, applicants must make a one-time payment of 2% of the total outstanding amount when applying. This condition is designed to protect the banks’ interests while simultaneously offering relief to exporters genuinely facing financial difficulties. Officials noted that the modest upfront payment strikes a balance between risk mitigation for banks and liquidity support for the sector.
The jute industry has recently encountered operational hurdles, including logistical bottlenecks in shipping, delays in remittance of export earnings, and volatility in raw material costs. Many exporters were unable to meet the original rescheduling deadline, heightening the risk of loan defaults and creating cash flow constraints that threatened ongoing production and trade operations.
Bangladesh is among the world’s leading jute producers, and global demand for this biodegradable, eco-friendly fibre is rising. With the increasing shift toward natural fibres as alternatives to plastic, the strategic importance of raw jute has grown significantly. Thousands of farmers, wholesalers, transport workers, and processors depend directly or indirectly on the sector, making sustained liquidity critical for both the industry and the broader economy.
Key Features of the Revised Policy
| Subject | Previous Deadline | Extended Deadline | One-Time Payment Requirement |
|---|---|---|---|
| Application for Defaulted Loan Rescheduling | 31 December 2025 | 30 June 2026 | 2% of outstanding loan amount |
The central bank has confirmed that the measure has been taken in the public interest under Section 45 of the Bank Companies Act, 1991. Banks have been instructed to facilitate the application process for eligible exporters without delay.
Economists emphasise that the rescheduling facility will provide immediate relief to exporters experiencing temporary cash flow shortages. By regularising outstanding loans, companies can regain access to operational capital, stabilising both production and export activities. Simultaneously, banks may see a reduction in the burden of non-performing loans.
Overall, the initiative is expected to boost export growth and strengthen foreign currency reserves, contributing positively to Bangladesh’s economic resilience and the long-term sustainability of its jute sector.