The Bangladesh Bank on Thursday launched an Asian Development Bank-funded $150 million or Tk 1,290 crore in refinance scheme to support setting up cottage, micro and small enterprises by returning migrant workers, youths and rural enterprises.
Under the project, the returning migrants, youths and rural enterprises will receive loans from the banks at the rate of 5.5 per cent for up to five years.
A BB guideline issued on the refinance scheme said that the CMSEs would get up to Tk 50 lakh from the refinance scheme.
Working capital or short-term loan will be provided for one year, medium-term loan will be provided for maximum three years and long-term loan will be given for maximum five years, it said.
As per the BB’s guideline on the project, supporting post-Covid small-scale employment creation, the banks would receive fund from the central bank at the rate of 1.5 per cent interest.
The tenure of the refinance scheme would expire in June 2025.
The banks and non-bank financial institutions, which would be disbursing the loans, would decide on the collateral issue based on Bangladesh Bank’s prudential guidelines and circulars.
In issuing loans, the migrants who have returned since the beginning of 2020 would be considered as eligible for the loans.
The unemployed or underemployed youth aged between 18-45 years and have received training from the government-approved institutions will get the finance.
In financing rural CMSEs, individuals residing outside Dhaka and Chattogram metropolitan areas would get the scope, the BB guideline said.
As per the guideline, at least 20 per cent of the qualified enterprises under the project must be women-led enterprises.
To be considered a women-led enterprise, women must have at least a 51 per cent stake in such entity. Besides, 60 per cent women managerial staff in any entity or enterprise would also make the entity a women-led enterprise.
The BB guideline said that the banks and financial institutions would be completely liable for the recovery of loans and there would be no relation whatsoever between recovery of loans and advances from the beneficiary and repayment of fund taken as refinance under this project.
Apart from the refinance scheme, the central bank would implement the second phase of a stimulus package of Tk 20,000 crore meant for the cottage, micro, small and medium entrepreneurs.
So far, the banks have disbursed around Tk 6,818 crore from the package.
Under the package, the government is paying 5 percentage points out of 9 per cent interest.
-With New Age input