The Bangladesh Bank on Sunday extended the deadline for banks and non-bank financial institutions to execute the stimulus package for cottage, micro, small and medium enterprises by another month.
According to the central bank decision, the new extended deadline for execution of the stimulus package is now November 30. With the latest extension, the BB has extended the deadline for implementation of the package twice now.
The central bank further extended the deadline as several banks and non-bank financial institutions failed to complete their disbursement targets within October 31.
‘Some banks and financial institutions have been able to disburse loans as per the target while some banks and financial institutions have failed to achieve the target set by the central bank,’ according to a BB circular issued on the day.
The BB said that the failure of banks and financial institutions to execute the package was hampering the expansion of production and services in the CMSME sector.
Earlier on July 02, the central bank asked all banks to take effective measures to implement the stimulus packages, including that for the CMSME sector, within August.
The banks were also asked to implement the lion’s share of the stimulus packages within July and the remaining portion by August this year.
On April 13 this year, the BB, in line with the government’s announcement, issued guidelines on providing working capital facilities amounting to Tk 20,000 crore to the CMSME sector affected by the coronavirus outbreak, setting the interest rate ceiling at 9 per cent.
Of the 9 per cent interest, the government will bear 5 percentage points as subsidy and the remaining 4 percentage points are supposed to be borne by borrowers.
However, banks and NBFIs were slow to lend to businesses belonging the cottage, micro, small and medium enterprises.
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