SBP extends EFS/IERS limits

KARACHI: The State Bank of Pakistan (SBP) has extended the sanctioned limits of banks to exporters under Export Finance Scheme (EFS) and Islamic Export Refinance Scheme (IERS) till August 31, 2009.
It said on Saturday that export refinance limits sanctioned in favour of banks for the year 2008-09 are due to expire on June 30, 2009.
Under the present system, exporters are required to submit EE-1 statement for the year 2008-09 duly verified by Foreign Exchange Operations Department latest by August 31, 2009.
Banks would therefore not be in a position to work out revised entitlement of limits for each exporter for availment under Part-II of the scheme for the year 2009-10.
In order to ensure that the financing facilities are available to exporters till finalisation of their new limits under Part-II of scheme, it has been decided as under:
a) Limits sanctioned by banks to individual exporters under Part-II of the scheme for 2008-09 shall continue up to August 31, 2009 to enable exporters to avail financing facilities under the scheme pending preparation of EE-1 statements, their verification by the Foreign Exchange Operations Department, SBP-BSC and submission of the same to the refinance units of the concerned office of SBP-BSC.
b) The facility under Part-II is self regulating and exporters should be able to evaluate correctly their export earnings during 2008-09, work out their own estimates as to the quantum of their entitlement for the year 2009-10 and should accordingly adjust their existing borrowings on or before end June 2009 to avoid utilisation of excess facilities under scheme during the period of roll over which would be subject to non-refundable fine.
The banks can submit their request for limits under EFS and IERS for the year 2009-10 to SBP separately up to June 25, 2009 to enable the central bank to finalise limits for the year 2009-10.
The State Bank has advised the banks to clearly intimate contents of sub para a & b above to their borrowers availing facilities under Part-II of the scheme for compliance.