VF Corporation, a leading apparel supplier chain company, and IFC, a member of the World Bank Group, have provided loans to three Bangladeshi garment factories under a new program for funding fire and building safety improvements.
Through the financing arrangement, VF provides a full corporate guarantee for up to $10 million that the IFC and its partner BRAC Bank lend to VF’s contract suppliers. This initiative helps VF suppliers in Bangladesh overcome financial obstacles to improve workplace safety conditions, VF Corporation said in a statement.
The financing structure from VF and IFC helps Bangladeshi garment factory owners meet the stringent standards set forth by the Alliance for Bangladesh Worker Safety (Alliance), an industry group of international apparel manufacturers and buyers whose work includes the inspection of Bangladeshi garment factories and development of corrective action plans for meeting acceptable standards.
IFC disbursed an initial set of loan payments, totalling $1.3 million, to three factory owners: Arunima Sportswear Ltd.; Olio Apparels Ltd.; and, Radisson Apparel Ltd. These owners will use the capital to invest in safety upgrades such as the installation of fire sprinklers, fire doors and detection systems, along with other necessary repairs and safety precautions.
VF and IFC are granting loans to VF’s supplier factories in the range of $100,000 to $1 million. The lending program is part of VF’s efforts to help suppliers achieve performance standards for assessing and managing environmental and social risks and impacts, and labour and working conditions.
Tom Glaser, VF’s president of Supply Chain said, “Providing these loans to help supplier factories fund the necessary improvement is another step in VF’s efforts to ensure the safety of the people making our products in Bangladesh.”
VF Corporation is a global leader in the design, manufacture, marketing, and distribution of branded lifestyle apparel.
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. (GK)
