The Bangladesh Bank today raised the interest rate for loans from its export development fund (EDF) by 1 percentage point with a view to making borrowing costlier and thus saving foreign currencies.

As per the new decision, the manufacturer-exporters will have to pay 4 per cent interest annually for foreign currency loans from banks.

Earlier, the lenders were allowed to disburse the loans at 3 per cent interest to the borrowers.

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Bangladesh Bank raises interest rate on EDF loans by 50%

The interest rate for banking regulator's loans extended to banks from the EDF will be 2.5 per cent, up from the existing 1.5 per cent.

The size of the export development fund is $7 billion.