The Alliance, which was founded by American retailer Walmart and comprises 26 global retailers, including fashion giants Gap and Target, aims to help out more than 700 factories that produce low-cost ready-made garments for brands such as Primark, Monsoon Accessorize, Benetton and Mango.
According to WWD, it “will” encourage banks to provide loans to member factories to assist them in complying new fire, building and electrical standards so workers can do their job in a safe environment.
“Our goal is to create a credit facility of $20 million to $35 million via five local banks,” the Alliance said in a report released yesterday. “Although this facility is still in the start-up phase, it represents an important breakthrough in providing access to affordable financing.” More than 1,300 garment workers were killed in the Rana Plaza factory collapse in 2013
This initiative comes after Bangladesh’s Rana Plaza building collapsed in April 2013, killing more than 1,130 people, leaving more than 2,000 injured and about 800 children orphaned, being one of the world’s worst industrial accidents, setting a raft of changes within the industry.
The Alliance has committed to train factories on a workers helpline, which is set to be available across all factories by July 2016 and through which employers can report problems and risks, as well as to provide banks with technical assistance on the remediation progress, promising to cover their administrative and start-up costs.