Business Report :
Prime Bank has marked a significant achievement as the first local bank in Bangladesh to successfully conduct an international factoring transaction, reinforcing its leadership in innovative financial services. This is a pioneering step in collaboration with FCI and an international correspondent covering exports of FGS Denims Ltd, to enhance the financing landscape for exporters, according to a press release.
This initiative, compliant with central bank directives, provides secure and efficient financing to exporters, reflecting Prime Bank’s dedication to economic growth and support for local enterprises. By facilitating immediate payments for deferred exports through partnerships monitored under FCI standards, Prime Bank showcases its commitment to global best practices since joining FCI in 2021.
The transaction, executed via FCI’s EDI platform, edifactoring.com, paves the way for unlocking significant international funding for Bangladesh’s export sector, offering vast opportunities for supply chain financing.
Md Nazmul Kabir, managing director of Fashion Globe Group, expressed delight in partnering with Prime Bank, emphasising the mutual benefits of catering to buyer credit terms and early non-recourse payments.
Hassan O Rashid, managing director & CEO of Prime Bank, highlighted the strategic importance of export receivables finance under credit coverage, expressing gratitude to Bangladesh Bank for policy support in promoting export sector growth.
Peter Mulroy, secretary general of FCI, commended this historic achievement and lauded the first factoring transaction in Bangladesh by Prime Bank under the two-factor model. He hoped that factoring business would grow in Bangladesh as exemplified by Prime Bank and help the economy grow even faster.
Professor Dr Prashanta Kumar Banerjee of BIBM lauded Prime Bank’s initiation of international factoring, following Bangladesh Bank’s FE circular no 25 on June 30, 2020, highlighting its benefits for trade financing without the need for security or the complexities of Letters of Credit, and expressed hope for other banks to follow suit to boost Bangladesh’s exports.
Shams A Muhaimin, DMD of Prime Bank, hailed the factoring transaction as a landmark deal for both Prime Bank and the local banking industry. He stressed that the credit coverage model mitigates default risks for our exporters, often uninformed about buyer’s credit information due to limited access. Prime Bank can also serve as a gateway for other banks to factor their receivables, while aiding industries in enhancing capacity.