FBCCI against lifting loan interest rate cap

Taking into consideration the situation in the country, the Federation of Bangladesh Chambers of Commerce and Industries (FBCCI) has urged the governor of Bangladesh Bank (BB) to not lift the cap on the loan interest rate.

The apex trade body’s leaders let Governor Abdur Rouf Talukder know about their opinion during a courtesy call on Thursday afternoon. After the meeting, FBCCI President Md Jashim Uddin told reporters that the central bank governor also agreed with them.

“If the cap is lifted, private sector credit flow will fall and it will hamper investment growth. It may affect employment generation initiatives as well. We voiced our concerns against lifting the cap and Bangladesh Bank agrees with us,” he said.

The apex trade body’s call comes after the Bangladesh Association of Banks (BAB) recently sent a letter to the governor, asking to lift the 9 per cent loan interest cap on non-productive sectors, including CMSME, as they fear the banks will incur huge losses.

FBCCI leaders on Thursday also requested Governor Talukder to restore discipline in the dollar market and take action against individuals or banks responsible for making the market volatile.

“We don’t want the banks to buy dollars Tk 93-94 from BB and sell it at Tk 105-110. Why is it happening? We heard that people in the stock market have also started dollar trading. These need to stop with a strong hand,” said Jashim.

BB Executive Director and spokesperson Serajul Islam on Thursday said that their drives will continue to keep the dollar market stable.

“The drives will continue until the market stabilizes. Licences will be cancelled if allegations against any money changer are found to be true,” he added.

The dollar price fell from Tk 112 to Tk 108 after BB conducted a drive in the open market on Wednesday. However, on Thursday, it was reported that banks bought dollars from remitters at Tk 109.

It has also been alleged that a section of importers is colluding with banks by opening LCs at abnormal prices to destabilise the market.

Asked whether FBCCI will act against them, Jashim told reporters, “Regulators know who is behind these things. No one is above the law. They must be punished.”

He said FBCCI has also demanded that BB needs to introduce equal loan rescheduling facilities for all types of borrowers. The demand for a separate bank for disbursing long-term loans has also been made.

Moreover, the business leaders urged the BB governor to not stop the loan facilities of an entire group if one unit of an industrial group defaults.