BB forms digital microcredit scheme to foster financial inclusion
From this fund, customers will get loan facilities ranging from Tk500 to Tk50,000 with a maximum of 9% interest rate
The central bank has formed a refinancing scheme of Tk100 crore for providing easy microcredit facilities to the impoverished and marginalised population of the country through digital means which include mobile apps.
From this fund titled 'Digital Micro Credit', customers will get loan facilities ranging from Tk500 to Tk50,000 with a maximum of 9% interest rate, according to a circular issued by the Bangladesh Bank on Thursday.
The circular said scheduled banks will be able to provide these loans using digital means such as internet banking, mobile apps, mobile financial services (MFS), E-wallet etc. The tenure of the loan will be a maximum of six months at both the bank and customer levels.
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With the aim of building Digital Bangladesh, the refinancing scheme was designed to provide digital microcredits on low interest by ensuring availability of small loans, encouraging banks and reducing their funding costs, the central bank said.
The term of this scheme formed with the central bank's own funding will be three years. Tk50 crore will be given in the first phase and another Tk50 crore refinancing facility will be provided in the second phase subject to ensuring proper utilisation of the loan, the circular stated.
The amount of refinancing will be increased in future considering the demand. Scheduled banks will be able to withdraw money from this fund, said the circular.
Banks will not be able to collect any other charges or fees from the customer other than the charges or fees mentioned in the existing 'Schedule of Charges' guidelines issued by the Bangladesh Bank, the circular said, adding that the lending banks will bear all the responsibility for the recovery of the loan disbursed at the customer level.
All scheduled banks offering digital microcredit will be considered eligible for availing the refinancing scheme. However, banks interested in the scheme must sign a participation agreement with the Financial Inclusion Department (FID) of the Bangladesh Bank, the circular added.
