Question & AnswerQ&A (BSP CIRCULAR NO. 68)
The Exporters Dollar Facility (EDF) is a credit facility established by the BSP that allows qualified banks to avail dollar-denominated loans against eligible loans of their exporter-borrowers, including those engaged in rendering technical, professional, and other services.
Qualified banks, which can avail the EDF against the eligible dollar-denominated loans of their exporter-borrowers including direct and indirect exporters and service exporters.
The interest rate shall be based on the prevailing three-month LIBID, reviewed and set every three months, with the bank's spread not exceeding 1 percent per annum after applicable taxes on foreign exchange loans.
The loan value shall be 100 percent of the face amount or outstanding balance of the loan, but it shall not exceed the amount of the Letter of Credit (LC), Purchase Order (PO), Sales Contract (SC), or Service Contract.
The maturity period shall not exceed 90 days and must not extend beyond the expiry date or validity period of the assigned LC, PO, or SC.
For Asia, Australia, and the US West Coast, it is 10 days; for the US East Coast, 15 days; for Europe, 30 days; and for Africa and the Middle East, 40 days.
Credits to service exporters shall have maturities not exceeding 180 days from the date of availment or not later than the expiry date of the contract, whichever comes first.
The dollar proceeds are released through the Treasury Department of BSP for credit to the designated correspondent bank of the borrowing bank on the same date the application is filed, provided it is received before 12:00 noon with complete supporting papers.
The loan must be repaid in dollars.
The availed amounts against dollar-denominated loans are charged against the borrowing bank's rediscount ceiling, which is 100% of net worth as of the end of the preceding quarter. For branches of foreign banks, it is 25% of 'Net Due To' plus assigned capital.
Yes, the documentary requirements pertaining to peso-denominated loans equally apply to dollar-denominated loans under the EDF.
BSP Circular No. 68 took effect immediately upon adoption on April 12, 1995, and it supersedes BSP Circular No. 57 dated December 9, 1994.