Banks asked to pay mark-up subsidy

Facility was offered under export finance and textile loan schemes.

KARACHI:

The State Bank of Pakistan (SBP) has asked banks and development finance institutions (DFIs) to make 40 per cent payment of the second installment of mark-up subsidy for the period from March 1 to August 31, 2010.

The mark-up subsidy was offered under the schemes of ‘Export Finance Mark-up Rate Facility’ and ‘Mark-up Rate Support for Textile Sector Against Long-term Loans’, the central bank said in a letter to banks and DFIs on Friday.

Banks have been asked that after making payments of the mark-up subsidy, the disbursing branches may seek its reimbursement from the offices of the SBP Banking Services Corporation.

The Ministry of Textile Industry has released the necessary budget to make payments for the second installment of the mark-up subsidy. However, budgetary allocation was not sufficient to clear 100 per cent claims under both the schemes for the six-month period, SBP said. Therefore, in consultation with the ministry claims were being cleared to the extent of 40 per cent, it added.

Published in The Express Tribune, May 21^st, 2011.