Special Loan Rescheduling

Defaulters get more time to apply for the facility

Staff Correspondent | Published: 00:00, Nov 18,2019


The Bangladesh Bank on Sunday extended the application submission deadline for granting loan defaulters special loan rescheduling and one-time exit facility by another 90 days.

A BB circular issued on the day said that it had extended the deadline following a High Court order issued on November 3 this year.

The extended timeframe began on Sunday, the BB circular said.

Under the special rescheduling policy that was introduced on May 16 this year, defaulters are allowed to enjoy a 10-year loan repayment tenure including a one-year grace period by paying only 2 per cent of their loans as down payment.

Initially the defaulters were given 90 days for filing applications to avail the scope but the deadline has been extended for several times.

Under the BB’s new circular, banks would be allowed to issue fresh loans to the beneficiaries of the loan rescheduling under special policy if the beneficiaries pay 15 per cent of their loans as down payment for loan rescheduling.

However, banks are barred from issuing fresh loans to the borrowers who would receive special rescheduling scope by paying 2 per cent of their loans as down payment.

Apart from the rescheduling for 10 years, the BB will also allow settlement of defaulted loans under ‘One Time Exit’ scheme that allows the defaulters to enjoy interest waiver for the preceding period of loan settlement.

However, the borrowers are supposed to clear the entire loan amount within 360 days without any grace period to avail the one time exit scheme.

The BB circular also allowed banks to grant rescheduling facility to the garments and textile entities without conducting special audit in the entities.

Applications for such loan rescheduling must be placed before the board of directors of bank concerned for approval.

No bank would be allowed to award the facility to any of its customers unless or until approved by the board.

The country’s banking sector has been mired in a series of scams and irregularities that took the amount of defaulted loans in banks to Tk 1,12,425.17 crore as of June this year.

If the figures of written-off loans and loans involving court orders were counted, the default loan figure would have reached Tk 2.2 lakh crore.

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