Only nine per cent of the Bangladesh Bank’s loan refinance scheme for renewable energy and clean water projects has been disbursed in the two years since the facility was launched on August 3, 2009.
Till July 2011, banks and financial institutions have borrowed only Tk 17.46 crore from the Tk 200 crore revolving funds.
Under the scheme, the central bank fully guarantees loans provided by commercial banks for solar power projects, biogas plants and industrial effluent treatment facilities.
A senior BB official said the amount of fund disbursed so far under the scheme was very poor due to a lack of awareness of clients of the banks and financial institutions about the facility. But, the rate of disbursement is improving, he said.
The official also said, ‘Most of the projects refinanced under the scheme are solar energy installations.’
Under the scheme, banks and financial institutions can get loans at five per cent interest from the central bank and they can charge a maximum of nine per cent interest on loans provided directly to their customers for implementing green energy and clean water projects.
But, if a bank or an FI provides the loans through non-government organisations, the interest rate can be stepped up to 10 per cent.
To date, 22 banks and FIs have availed of the refinance facility from the alternative energy fund. Of them, 18 are private commercial banks, two state-owned banks, one is a foreign bank, and the last a financial institution.
The banks participating in the scheme are Sonali Bank, Bangladesh Krishi Bank, AB Bank, Bank Asia, BRAC Bank, Dhaka Bank, Dutch-Bangla Bank, Eastern Bank, First Security Islamic Bank, IFIC Bank, Jamuna Bank, Mercantile Bank, Mutual Trust Bank, National Bank, National Credit and Commerce Bank, ONE Bank, Prime Bank, The City Bank, Premier Bank, Trust Bank, and the Commercial Bank of Ceylon.
According to the BB guidelines, the highest amount that can be lent for a project under the scheme is Tk 1 crore.
The guidelines said, ‘Banks and FIs can lend a maximum of Tk 70,000 in rural areas and Tk 175,000 in urban areas for installation of a solar panel, a maximum of Tk 36,000 for a bio-gas plant or a poultry farm, a maximum of Tk 30,000 for a cattle farm, and a maximum of Tk 1 crore for an ETP under the refinancing scheme.’
-With New Age input
