Bangladesh Bank has instructed all scheduled banks to ensure adequate financing for raw hide traders ahead of Eid-ul-Azha, aiming to support smooth collection, preservation and marketing activities during the peak seasonal period.
The directive was issued on Tuesday through a BRPD circular, which described the leather sector as one of Bangladesh’s key labour-intensive and export-orientated industries. The central bank said the sector plays an important role in generating national income and foreign exchange earnings, relying heavily on locally sourced raw materials.
According to the circular, nearly 50 per cent of the industry’s annual raw material supply comes from sacrificial animals during Eid-ul-Azha, making timely credit support critical for maintaining stability across the leather supply chain.
To ensure sufficient liquidity in the market, the central bank directed banks to keep their 2026 raw hide financing targets at no lower than the levels set for 2025.
It also instructed lenders to extend financing facilities to the grassroots level so that seasonal traders and small-scale merchants can participate actively in raw hide procurement. Loans are to be disbursed based on existing bank-client relationships.
In a further step to facilitate fresh financing, Bangladesh Bank allowed the rescheduling and relaxation of existing loans, including those held by defaulted borrowers in the leather sector.
Banks have been asked to complete loan rescheduling and compromised amount arrangements by 30 June 2026, enabling borrowers to clear outstanding dues and access new funds for the current season.
For compliance and monitoring, all scheduled banks must submit detailed reports on credit targets and actual loan disbursements to the Director of the Banking Regulation and Policy Department-1 by 31 July 2026.
The directive was issued under Section 45 of the Bank Company Act, 1991.
