Bangladesh’s central bank eases debt burden for companies amid economic stress
Staff Correspondent, bdnews24.com
Published: 23 Jun 2022 01:48 PM BdST Updated: 23 Jun 2022 01:48 PM BdST
Bangladesh Bank says that no companies from “major industries” will be deemed to be defaulters if they manage to repay at least half of their instalments.
For example, a company will avoid falling into the category of defaulters by repaying at least 50 percent of the loans payable for the April-June period, according to a notice issued by the central bank on Wednesday.
For SME institutions, the level will be as low as 25 percent of their instalments.
However, this benefit is only available to those entrepreneurs who have repaid their loans regularly. That means that they must not have defaulted on their instalments until April of this year to take advantage of the incentive.
Bangladesh Bank has introduced several loan incentives and policy benefits to help the economy recover from the impact of the pandemic.
A notable policy was not to penalise companies for being unable to make their loan payments. Even last year, businesses were able to avoid defaulting on their loans if they were to deposit at least 15 percent of it.
But leaders from the FBCCI, the apex business association in the country, recently met with Bangladesh Bank Governor Fazle Kabir to demand an extension for the repayment for incentivised loans, waivers for failing to repay last year’s loan instalments and an extension of default forgiveness until this December.
Following the meeting, the central bank issued a statement saying that it would make a ‘reasonable’ decision on the issue after taking the opinions of bankers into consideration.
It then announced the easing of the loan burden until February 2023 in its notice on Wednesday.
“The long-term negative effects of COVID-19 are persisting. There has been a recent rise in infections, and floods have caused extensive damage in the north and northeast of the country," the central bank said in a statement.
“In addition, Bangladesh Bank has noticed that borrowers are having difficulty repaying the full amount of their loan instalments due to the recent war in the international arena, which has led to an increase in the price and transportation costs of various materials, including raw materials, in the international market.”
The central bank said it eased the burden of instalments to maintain economic momentum and normalise the flow of credit to the private sector.
-
India to address volatility in rupee against dollar
-
Bangladesh suspends funds for 'less important' govt projects
-
Remittances fall 15% year on year in FY22
-
State minister apologises for power cuts
-
Government halts vehicle purchase, meeting honorariums
-
Sri Lanka struggling to pay for fuel shipments
-
Argentina economy minister quits amid crisis
-
EU agrees to tame 'Wild West' with new crypto market rules
-
Bangladesh suspends funds for 'less important' projects as austerity drive ramps up
-
Bangladesh remittances fall 15% year on year in FY22
-
Bangladesh state minister apologises for power cuts fuelled by gas shortage
-
More austerity: government suspends vehicle purchase, meeting honorariums
-
Sri Lanka struggling to pay for fuel shipments: minister
-
Argentina economy minister, IMF deal architect, quits as government crisis builds
Most Read
- Bangladesh is gearing up to open its first river tunnel by the end of 2022
- Drastic fall in passenger numbers forces owners to cut Dhaka-Barishal launch fares
- Biman Bangladesh jets collide again at Dhaka airport
- Bangladesh to celebrate Eid-ul-Azha on Jul 10
- Amin Hilaly, ‘missing’ real estate boss named in NSU graft case, is found in Savar
- Bangladesh state minister apologises for power cuts fuelled by gas shortage
- Bangladesh’s exports climb to record $52bn in FY22
- Fire at Meghna Group packaging factory under control after 3.5 hours
- Bangladesh suspends funds for 'less important' projects as austerity drive ramps up
- Ex-BCL leader sets himself on fire at Press Club in Dhaka