BB stretches disbursement of stimulus packages by March

Bangladesh Bank Governor Fazle Kabir has thanked 10 banks for achieving 100 percent loan disbursement target set by the central bank under the stimulus packages for CMSMEs.

The banks are BRAC, Bangladesh Krishi Bank, Rajshahi Krishi Unnayan Bank, Bank Asia, Prime, One, Eastern, Uttara, Modhumoti and Bank Alfalah.

The governor in a virtual meeting with the Managing Directors and Chief Executive Officers of scheduled banks asked for exhausting all stimulus packages by March 31, to help revive the economy from loss caused by pandemic.

Bangladesh Bank arranged a meeting with all the scheduled banks in an interval of every three months chaired by governor.

The latest meeting held virtually on Wednesday discussing different issues including revival of the country’s economy from challenges of coronavirus, disbursement of loans under stimulus packages, situation of private credit growth, clearing LC payment, recovery of installment of loans etc.

The governor gave a 'strong message' to the bankers to clear both local and foreign unsettled import bills immediately, said Serajul Islam, spokesperson of BB.

Private sector credit growth will be increased in the coming months if the banks implement the financial packages fully by March 31, the spokesperson said.

The BB's directive came against the backdrop of slower progress in loan disbursement under the packages, particularly for the cottage, micro, small and medium enterprises (CMSMEs).

The stimulus package for large industries and services has almost been disbursed while 58 percent of package for the CMSMEs executed as of January 21.

Nearly Tk 309 billion was disbursed as working capital until January 25 under the stimulus package of Tk 330 billion for large borrowers in industrial and service sectors. The implementation rate of the package is nearly 94 percent.

The banking and non-banking financial institutions disbursed Tk 115 billion of the stimulus package to the smaller firms, which are 58 percent of the total allocation of Tk 200 billion.

Loans amounting to around Tk 130 billion were approved for 81,000 Covid-affected CMSMEs across the country during the period, the BB's data showed.

According to BB report, three other private commercial banks have achieved more than 80 percent of their initial targets of the financial package for the CMSMEs.

The central bank extended the deadline for three more months to banks and non-banking lenders to serve CMSMEs.

Under the revised deadline, banks and NBFIs are now allowed to implement the package for the sector by March 31, 2021 instead of December 31, 2020.