Desk Report:
Entrepreneurs are facing various hurdles in accessing the announced stimulus loans intended to restart closed factories and bring affected businesses back into economic activity. Business leaders have demanded a simplification of loan eligibility criteria and the withdrawal of the requirement to deposit 2 percent in cash to clear loan defaults. They also urged for the speedy processing of loan applications and a reduction in bureaucratic delays by banks.
These demands were raised during a meeting between representatives of various business organizations and Bangladesh Bank on Tuesday. At the meeting, business leaders complained that they are encountering various complications and bureaucratic delays at the bank level when attempting to access loans from the Tk 20,000 crore stimulus fund. In many instances, excessive documentation is being requested, and the decision-making process regarding loan applications is taking an unduly long time.
Representatives from the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Bangladesh Textile Mills Association (BTMA), Bangladesh Chamber of Industries (BCI), Bangladesh Employers’ Federation (BEF), Bangladesh Jute Association (BJA), and Metropolitan Chamber of Commerce and Industry (MCCI) participated in the meeting.
Officials from relevant departments, including Deputy Governors Md. Kabir Ahammad and Md. Sarwar Hossain, were present on behalf of Bangladesh Bank.
The meeting included discussions on the implementation status of various stimulus programs launched by the government and Bangladesh Bank. Participants reviewed whether there were any shortcomings, ambiguities, or implementation-related issues in the policies issued by Bangladesh Bank regarding these programs. Emphasis was also placed on identifying businesses that have genuinely suffered losses and ensuring they receive the necessary support. Business representatives pointed out that there are delays regarding bank board meetings when it comes to approving loan or financial assistance applications; in some banks, it takes up to a month for a board meeting to be held. Consequently, they demanded the holding of special board meetings—either weekly or as needed—to expedite the processing of incentive loan applications.
Furthermore, demands were made to stop the practice of requesting excessive documentation during the loan application process and to simplify the decision-making procedure. Businesspeople stated that genuine entrepreneurs who have suffered losses are unable to avail themselves of the incentive program’s benefits due to complications at various levels within the banks.
Bangladesh Bank stated that the proper implementation of the incentive program’s guidelines is a collective responsibility shared by all relevant parties. Banks, business associations, and other stakeholders must work in a coordinated manner to ensure that genuinely affected businesspeople receive assistance quickly. At the same time, emphasis was placed on ensuring the proper utilization of funds from the incentive package.
Business associations also urged for thorough scrutiny when issuing No Objection Certificates (NOCs).
BKMEA President Mohammad Hatem told reporters that entrepreneurs are keen to benefit from the Tk 20,000 crore incentive package. However, many are unable to apply due to a lack of cooperation from various banks. Some banks show reluctance to accept applications, while others discourage entrepreneurs using various pretexts.
He noted that there are certain complexities in the circular issued by Bangladesh Bank. A demand was made to quickly resolve these issues and process the applications that have already been submitted. Bangladesh Bank has also assured that the matter will be resolved promptly.
Last May, Bangladesh Bank announced a fund worth Tk 62,000 crore aimed at reopening closed factories and revitalizing the country’s economic activities. The plan involved providing loans from this fund to entrepreneurs across various economic sectors at a maximum interest rate of 7 percent. Bangladesh Bank had stated that this program would generate employment for 2.5 million people. However, businesspeople have stated that even four months after the announcement, the tangible benefits of the stimulus program have not yet become visible in the economy. According to Bangladesh Bank sources, only Tk 50 crore in loans has been disbursed so far against a total fund of Tk 20,000 crore. The pace of loan disbursement in other sectors is also unsatisfactory.
