Bangladesh Bank has introduced a Tk100 crore refinance initiative titled "digital nano loan" disbursements with an aim to expand financial inclusion for the underprivileged.
Participating banks will be able to disburse loans of Tk500 to Tk50,000 to individual customers with up to 9% interest under the scheme.
The loans have to be disbursed entirely digitally by using internet banking, mobile apps, mobile financial services (MFS), or e-wallet services, according to a central bank circular on Thursday.
Scheduled banks will be able to avail the fund to disburse it to customers.
Of the Tk100 crore, Tk50 crore will be disbursed as loans and later, another Tk50 crore will be given as refinance benefits.
However, the banks will have to have digital infrastructure to disburse the loans or partner with any digital financial service provider, according to a Bangladesh Bank official.
Beneficiaries will have to repay the loan within six months of receiving it.
Dhaka Bank and Prime Bank are running a pilot digital nano loan project to launch the service soon.