Credit Card Bills

Banks asked not to charge compound interest till May

Staff Correspondent | Published: 22:12, Apr 15,2020

 
 

The Bangladesh Bank on Wednesday asked banks not to charge monthly compound interest rate on credit card bills till May 31 due to the coronavirus outbreak in the country.

The BB in a circular said that it was not acceptable that some of the banks were charging monthly compound interest rate on unpaid credit bills when the country was passing through a crisis.

Against the backdrop, the banks have been asked not to charge monthly or daily compound interest on unpaid credit card bills from March 15 to May 31, it said.

The banks, which have already charged or accrued compound interest on the customer’s credit card bills from March 15, were asked to pay back to customers’ account, it said.

On April 4, the central bank instructed all the banks of the country to waive late payment fees and other charges on credit card bills till March 31 in light of the coronavirus pandemic.

The BB on Wednesday also opened up low-cost fund to the C-type industries located in the export processing zones, economic zones and high-tech parks for the payment of salary of their employees.

The central bank initially had said that the export-oriented entities would get access to the fund for the payment of their workers’ and labour’s salary.

A BB circular issued on Wednesday also said, ‘Though the BB initially mentioned that the fund could only be used for the workers’ and labours’ salary payment, the workers-labour would be determined under the definition outlined in the Bangladesh Labour Act, 2006.’

The sector, having no wage board-endorsed schedule of employees, will have to take endorsement on the employees’ list from the trade body that represents the sector, the BB circular said.

Prime minister Sheikh Hasina on March 25 announced a Tk 5,000 crore stimulus package for the export-oriented industries to fight the impact of coronavirus on the country’s economy.

As per the BB-announced guidelines, the export-oriented industries will have to pay back the fund within two years, or else they would be considered defaulters.

For the failure, the beneficiary enteritis will have to face 2 per cent penal interest, as per BB regulations.

The interest-free loan, which will be used to pay wages to the employees of the industrial units, will carry 2 per cent service charge and has a repayment period of two years, including a grace period for six months from July to December this year, according to the BB rules.

Factories which were exporting at least 80 per cent of their products are declared eligible for the loans.

Active factories which have paid salaries and wages to workers during December to February would also be considered for the credit facility.

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