Federation of Bangladesh Chambers of Commerce and Industry president Md Jashim Uddin on Thursday said that wilful defaulters should face action while support should be extended to individuals who have failed to repay bank loans unwillingly.

He came up with the statement while addressing a discussion on ‘The Role of Banking Sector in Economic Development and Advancement of the Country under the Existing Context: Problems and Prospects’ organised by the FBCCI at a hotel in Dhaka on Thursday.

The sufferings of 90 per cent of the good bank borrowers are not accepted due to the 10 per cent bad customers, said Jashim.

‘Action should be taken against wilful defaulters but the banks should cooperate with borrowers who are not defaulters by choice,’ the president suggested.

The FBCCI president suggested that small and medium entrepreneurs should get increased timeframe of 10 to 15 years for term loans along with a grace period of two years.

Jashim said that the banks had been reluctant to settle the liabilities of distressed non-textile industries even after an instruction given by the finance ministry.

As a result, the recovery of a huge amount of overdue loans from the sector was delayed, he said.

Loans of the industries, which had already been written off from the banks’ balance sheets, were already dead, he said, adding that an exit facility for the entities would ultimately help to bring down defaulted loans to a certain extent.

He also said that the banks were reluctant to establish help desks and service centres for the SMEs as they were instructed by the central bank to ensure about the forming source of finance for businesses in the sector.

The president urged the banks to ensure the facilities at all banks.

At the discussion, Eastern Bank managing director Ali Reza Iftekhar said that the banks would extend their support to keep businesses afloat.

Iftekhar, also the chairman of the Association of Bankers Bangladesh, urged that the FBCCI to support the bankers in recovering the loans taken by the wilful defaulters.

Speaking about the banks’ reluctance in issuing loans to the small and medium entrepreneurs, the managing director said that issuing loans to the SMEs was not as easy as it was for the large-loans.

He said that some of the banks might have been reluctant in issuing loans to the SMEs after the imposition of the 9-per cent ceiling on lending rate, taking the cost of fund into consideration.

However, 80 per cent of the stimulus fund had already been disbursed by the banks and it was satisfying, he said.

The ABB chairperson said that the stimulus funds issued by the banks to the businesses were not grants but loans issued by the banks and they would have to get the money back from the borrowers.

So, the banks will assess the customers before issuing loans, he said.