6/29/2020 Equity and Entrepreneurship Fund Unit
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02. Eligibility for equity support from the Equity and Entrepreneurship Fund Unit (EEF):
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1. The project will have to be a new one and belong to either of the sectors viz., software industry or food processing and agro-based industry. Index
Objective
2. The sponsors/entrepreneurs applying for EEF support will have to be a private limited company registered under the Companies Act, 1994 and Eligibility
established old companies can also apply for EEF support by setting-up a subsidiary new private limited company. But in case of a software
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company registered on or after 01 January, 1997 will be treated as a new company.
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3. The total project cost ( including net working capital ) of the proposed project will have to be of minimum 0.50 (half) core for both IT and agro- Steps
based industries and that of the maximum is Taka 5.00 Crore for IT& Taka 10.00 Crore for agro –based industries . Project proposal with bank Agreement
loan is not allowed for agro –based industries but allowed for IT industries.
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4. The project shall have to be viable technically & financially .It should be environment friendly. Importance shall be given on the appraisal of the
entrepreneurship such as educational qualification in the relevant discipline, knowledge in the technology/ process operating such project, track Print this page
records in financial conduct specially with Banks/FI. In case of ratio analysis the project has to offer minimum IRR (Internal Rate of Return) of
15%, Return on equity (ROE) of 15% Debt service coverage Ratio 1.50:1 Current ratio 1.50:1 and Fixed asset coverage ratio 1.50: 1 and SWOT
analysis should have to be acceptable.4. The project shall have to be viable technically & financially .It should be environment friendly. Importance
shall be given on the appraisal of the entrepreneurship such as educational qualification in the relevant discipline, knowledge in the technology/
process operating such project, track records in financial conduct specially with Banks/FI. In case of ratio analysis the project has to offer
minimum IRR (Internal Rate of Return) of 15%, Return on equity (ROE) of 15% Debt service coverage Ratio 1.50:1 Current ratio 1.50:1 and Fixed
asset coverage ratio 1.50: 1 and SWOT analysis should have to be acceptable.
5. The non-resident Bangladeshis will be given preference subject to the fulfillment of the terms & conditions mentioned in the above paragraphs.
6. Any defaulter (as defined by Bangladesh Bank) cannot apply for EEF.
7. Where a sponsor of a project needs term-loan and /or working capital loan from any Bank/FI and also equity support form the EEF, he has to
submit application to the Bank/FI concerned. The Bank/FI will have to be satisfied that the project has fulfilled all the terms and conditions
required. Where the sponsors/entrepreneurs need only equity support from EEF without any bank loan a Bank/FI will be nominated as
representative of EEF for appraisal of the project by Bangladesh Bank(EEF) . To nominate such Bank/FI, previous business relationship of
entrepreneur with the Bank/FI will be considered. The concerned Bank (which will also act as monitoring bank) will make thorough appraisal of
the project in accordance with EEF rules and guidelines and if the bank is satisfied about the viability of the project they shall send the project
proposal with specific recommendation to Bangladesh Bank. The Bank/FI may determine their project examination fee according to their existing
rules. Bangladesh Bank, EEF Unit will re-examine the project appraisal and perform pre-sanction visit if necessary. Then EEF Unit will place it
with specific recommendation before the Technical Advisory Committee (TAC). TAC is a four member expert Committee under the chairmanship
of the Governor of the Bangladesh Bank. This Committee is the ultimate authority to approve the projects. When a project is approved by the
TAC, EEF Unit will issue a sanction letter to the concerned entrepreneur instructing them to invest their portion of equity within a certain period of
time.
https://www.bb.org.bd/aboutus/dept/eef/eligibility.php 1/1
