Tk5 lakh loans for those who returned to villages from cities due to Covid-19

The Bangladesh Bank will give a loan of at least Tk5 lakh to those who returned to their villages from cities due to the "Covid-19 pandemic or other reasons" under the "Ghore Fera" (Returning Home) scheme.  

The "Ghore Fera" scheme, aimed towards creating employment and alleviating poverty, has a Tk500 crore fund which can be increased if necessary, the central said in a circular issued on Monday.

Banks will be able to disburse loans up to a minimum of Tk5 lakh at a maximum interest rate of 6% for a period of three years under the fund.

The loan disbursement period is fixed till 31st December, 2024, but the collection from the customers will continue.

Those involved in small businesses, small engineering industries, fisheries, vegetable or fruit cultivation, information technology service centres or other services can avail the loans. The money can also be used to purchase small and medium transport vehicles, cattle, goats, poultry, boats, sewing machines and to renovate or construct homes.  

Targeting the rural areas, loans under the scheme will also be provided for small businesses such as those involved in rice threshing, producing puffed or flattened, fried rice, beekeeping, artificial jewellery-making, candle-making and for any project employing persons with disabilities and poor women.

In these cases, trainees from government agencies will get priority, the Bangladesh Bank said in the circular.

Banks interested in participating in the scheme have been instructed to apply to the Agriculture Credit Department of the Bangladesh Bank.

Participating banks will get a refinancing facility from the central bank at a fixed interest rate of 0.5%, but no security deposits can be taken in case of loan disbursement.

At the same time, 10% of the loans disbursed have to go to women borrowers and entrepreneurs.

The maximum repayment period for loans up to Tk2 lakh will be 24 months, with a grace period of three months. For loans above Tk2 lakh till Tk5 lakh, the maximum repayment period will be 36 months, with a grace period of six months.

Loan disbursing banks will be able to disburse and collect loans at customer level through branches, sub-branches, agents and mobile financial services.

If the borrower is not a defaulter, they will be able to take a new loan again after repaying the previous one. The loan, however, cannot be used to pay off any other outstanding loan.