100% interest for encashing ERQ account deposits before term end

The central bank has directed commercial banks to provide exporters 100% interest for encashing termed deposits kept in Export Retention Quota (ERQ) accounts even before they are matured.

According to a Bangladesh Bank circular issued Tuesday, the banks have to give the exporters 100% interest as per agreement even if the term of the ERQ accounts deposits are not completed.

Exporters deposit a certain portion of their income in the ERQ accounts against their exported goods and services. Due to the current dollar crisis in the country, exporters have been given a facility to redeem dollars from these accounts before maturity, said officials concerned. 

According to a notification issued by the Bangladesh Bank on 14 July, 50% of the deposit held in the ERQ accounts should be encashed or released to the market to ease the country's dollar crisis.

The notification also said it has been decided to revise retention limit out of realised export proceeds from 15%, 60% and 70% to 7.50%, 30% and 35% for respective sectors. The revised limit will remain valid till 31 December 2022.