Bangladesh Bank to supply half of Tk 20,000cr stimulus package for SMEs

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Bangladesh Bank provides half of the Tk 20,000 crore stimulus package announced by the federal government for the cottage, micro, small and medium enterprises sector -- to deal with the economic fallout due to the coronavirus pandemic.

The decision was taken taking into consideration the liquidity crisis of the banks, the central bank said in a circular issued to commercial banks today.

Because of this, the central bank has rolled out a refinance scheme of Tk 10,000 crore. Beneath the scheme, banks and non-bank financial institutions (NBFIs) will need out funds in the kind of working capital at 4 percent interest from Bangladesh Bank, that your end-users are certain to get at 9 percent interest.

The duration of the refinance scheme is 3 years. Lenders will need to sign a participation agreement with the central bank to take out the fund beneath the scheme.

If lenders disburse funds to other sectors breaching the regulations, the central bank will impose yet another two percent interest on them.

Lenders will have to take all responsibilities to recover the loans, which is disbursed from the fund.

LOANS FOR FARMERS AT 4 PERCENT INTEREST
In another move, the central bank said farmers can secure farm loans at 4 percent interest to cultivate crops amidst the ongoing shutdown as a result of coronavirus pandemic.

Banks, however, will enjoy 9 percent interest on the disbursed farm loans as the central bank provides 5 percent interest subsidy to them.

Farmers will be permitted to get the subsidised loans from April 1 this season to June 30, 2021, according to a central bank notice.

Any fresh refinance scheme isn't needed for farmers at this moment as banks have to hand out at least 60 percent of their twelve-monthly farm loan target to the crop sector, a Bangladesh Bank official said.
Source: https://www.thedailystar.net

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