Simplify loan application process: BB asks banks

Bangladesh Bank has asked all banks and non-bank financial institutions (NBFIs) to ensure simplicity in every stage and quick disposal while considering loan applications of the coronavirus-affected cottage, micro, small and medium enterprises (CMSMEs) under the Tk 20,000-crore stimulus package for the sector.

The central bank on Thursday issued a circular in this regard.

To help the potential CMSMEs, the BB also asked the banks and NBFIs to set up a designated desk at each branch by putting up a notice containing detailed information of the package.

On March 25, the government announced a Tk 20,000-crore stimulus package for the CMSMEs at 9 percent interest rate.

The government will give 5 percent interest subsidy and the respective borrower will bear the remaining 4 percent interest.

If need be, the BB suggested that the banks or NBFIs take support from the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) and its associate bodies for the selection of borrowers, loan dissemination and its supervision, and recovery activities.

Both the financial entities have also been asked to report to the central bank on the loan disbursement and recovery.

Considering the liquidity crisis of the banks, the BB on April 27 also announced that it would contribute 50 per cent to the loans which the banks and NBFIs would disburse to the CMSMEs under the stimulus package.