State-owned banks to give more capital loan

The state-owned banks are coming up with a special 'capital loan' of around Tk 16,000 crore for the industry and service sectors where coronavirus pandemic played spoilsports, an official of the Financial Institutions Division said.

The loan will be provided to the pandemic-affected businesses from the Covid-19 incentive package programme for the next three years.

Of this, loan assistance of Tk 4,060 crore will be given in this financial year. The target is to distribute Tk 5,465 crore next year and Tk 6,010 crore in 2022.

Recently, six state-owned banks have signed annual agreements with the Ministry of Finance. According to working paper of loan, incentive package of special capital loan assistance for the industry and service sector affected by the coronavirus pandemic. This information has been found in the relevant sources of the Financial Institutions Division.

While the banks are praising the initiative, traders are worried about whether the benefits will reach the really-affected businessmen and industrial entrepreneurs.

Therefore, the loan disbursement policy of the banks is simpler, the banks have to make decisions outside the conventional ones. Stakeholders have recommended giving priority to small entrepreneurs in the list of loan recipients.

The former governor of Bangladesh Bank Dr Saleh Uddin Ahmed told that the plan to implement the three-year loan package is good. But before that we need bank management, change of board of directors. It will not be possible to implement these packages in the traditional way, he said. He further said that the success of the loan package will depend on the financial condition, efficiency and monitoring system of the bank.

Former governor of BB said, “For this we have to come out of the conventional trend. The board of directors must be free from political influences. Then it is possible to implement, he added.

According to sources, the interest rate on loans offered under this special package will be lower than any other loan. Under this programme, Sonali Bank will provide loan assistance of Tk 5,200 crore for the next three years (2020-2022).

Besides, Janata Bank will provide Tk 4,200 crore, Agrani Bank Tk 3,000 crore, Rupali Bank Tk 3,300 crore, Basic Bank Tk 294 crore and Bangladesh Development Bank (BDBL) will disburse Tk 50 crore.

Mohammad Hatem, senior vice-president of the Bangladesh Knitwear Manufacturers and Importers Association (BKMEA), said, “This is because the loans being given under the current incentive package are not reaching the real victims due to some policy issues.”

He said, “There will be no real benefit if there is no policy shift in the future loan disbursement targets. The policy needs to be made easier if these loans need to reach the affected industry and service sectors, he said.

ask/wi