In order to ensure continued export financing facility, State Bank of Pakistan (SBP) on Tuesday announced that it has extended the current limits, sanctioned in favour of banks under Part-II of the Scheme for the year 2015-16, up to August 31, 2016. According to IH&SMEFD Circular Letter No 04 of 2016, export refinance limits sanctioned in favour of banks for the year 2015-16 are due to expire on June 30th, 2016. Under the present system, exporters are required to submit EE-1 statement for the year 2015-16 duly verified by our Foreign Exchange Operations Department latest by August 31, 2016.
Therefore, banks would not be in a position to work out revised entitlement of limits for each exporter under Part-II of the Scheme for the year 2016-17. Hence, in order to ensure that the financing facilities are available to exporters till the finalisation of their new limits under Part-II of Scheme, it has been decided to extend the current limits up to August 31, 2016.
The SBP said that limits sanctioned by banks to individual exporters under Part-II of the Scheme for the year 2015-16 shall continue up to August 31, 2016, to enable exporters to avail financing facilities under the Scheme pending preparation of EE-1 statements, their verification by the Foreign Exchange Operations Department, the SBP BSC and submission of the same to the Refinance Units of the concerned office of SBP BSC. In addition, to get verify EE-1/EF-1 statements and subsequently submit the same to concerned SBP BSC Offices within deadline ie August 31, 2016, all exporters should submit EE-1/EF-1 statements duly complete in all aspects to concerned SBP BSC Office through their banks well in time.
The banks are advised to inform exporters that they should ensure timely submission of EE-1/EF-1 statements in their own interest and avoid delaying submission of these statements in expectation of extension in deadline, the circular warned. The facility under Part-II is self-regulating and exporters should be able to work out correctly their export earnings during FY 2015-16, estimate the quantum of their entitlement of limit for the year 2016-17 and accordingly adjust their existing borrowings on or before June 30, 2016 to avoid utilisation of excess facilities under the Scheme during the period of roll over which would be subject to non refundable fine.
Requests from banks for limits under the Export Finance Scheme and Islamic Export Refinance Scheme for the year 2016-17 should be submitted to the SBP separately up to July 4, 2016 to enable us to finalise limits for the year 2016-17. In addition, banks has been asked to ensure submission of their requests for limits within due time. Further, the existing limits of banks under EFS/IERS will continue until fresh limits for FY 2016-17 are notified. Meanwhile, the SBP, through another circular, has announced to extend the limits of Long Term Financing Facility (LTFF).
The SBP said that the LTFF limits sanctioned in favour of banks/DFIs for the year 2015-16 are due to expire on 30-06-2016. In order to ensure that financing facilities are available to borrowers till finalisation of new limits under the LTFF for the financial year 2016-17, it has been decided to continue the existing limit until fresh limits for FY 2016-17 are notified.
Further, banks have been advised to furnish information of Limit requirements for FY 2016-17 under the LTFF, latest by July 4, 2016, to enable us to finalise limit under LTFF for FY 2016-17. Banks have also been asked that limit request should be duly supported by borrower-wise details of cases being sanctioned, application(s) in process / details of LCs established and their expected date(s) of retirement.
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