Bangladesh Bank today rolled out a Tk 5,000 crore refinance scheme to help borrowers procure environment-friendly capital machinery.

The scheme named "Green transformation fund" will help borrowers to replace their existing capital machinery, which are harmful for environment.

Businesses will be allowed to get fund to replace their capital machinery in nine categories.

The nine fields include water use efficiency in wet processing, water conservation and management, resource efficiency and recycling, renewable energy and heat and temperature management, according to a central bank notice.

Borrowers will enjoy the fund at 5 per cent interest from banks.

Lenders, however, will manage the fund at 1 per cent interest from the central bank, meaning that they can enjoy a profit margin of 4 percentage points.

The nature of the fund is term loan as the repayment tenure of the fund is more than two years.

Clients will be allowed to enjoy a grace period of one year when they will repay any instalment.