Egyptian banks have placed restrictions on textile credit facilities and loans extended to factories after classifying the industry "risky," textile producers said on Sunday.
Bank charges for textile accounts increased between 3 and 4 percent in the last two years, thereby raising loan collateral for such factories to 16 percent, industry producers argued, adding that the banks do not put the same restrictions on factories of finished garments, although that market is equally competitive.
“These banks do not have technical divisions that can determine how risky this industry is,” said Magdy Tolba, former president of the textile export council. “And the international collateral rate is between 3 and 6 percent.”
Translated from the Arabic Edition.