Migrant rights activists say it is very unfortunate that migrant workers are not getting due support from the bank. This is the third instalment of a five-part series
Though eight years have passed since the establishment of Probashi Kallyan Bank (PKB), very few people know about the facilities it extends.
The PKB was established to provide collateral-free and low-cost loans to migrant workers but the bank has failed to do so.
Migrant rights activists say it is very unfortunate that migrant workers are not getting due support from PKB.
Official statistics show that less than one percent of migrant workers received migration loans from the PKB in fiscal year (FY) 2016-17.
The institution that could potentially be the biggest hope for returning migrant workers, is saying that they are at their final phase of becoming a migrant friendly bank soon.
However, the authorities said the biggest problem with the bank is not being able to operate as a scheduled bank, which has been hindering their core function of helping migrant workers.
Managing Director (MD) of the bank, Mahtab Zabin, said that last year Bangladesh Bank approved PKB to operate as a scheduled bank.
“We are operating our branches in a difficult situation. Being a specialized bank, we have to develop our infrastructure. Besides, we have already started our work for attaining a batch number for the bank.”
The bank made an agreement with Bangladesh Krishi Bank and made a provision for migrants workers so they can send money from abroad, she added.
Will Probashi Kallyan Bank ever become
Bank sources said, it started with 30 permanent employees at its main branch in 2011. The bank currently has 63 branches with 127 permanent employees, including the 30 employees at the main branch.
Principal Executive Officer (PEO communication), Mohammad Kamal Hossain, said PKB is the only bank that it disburses loans within three days to loan recipients, if all documents are found to be okay. “We provide up to 70% of project capital as a loan if all the papers submitted by a returning worker are satisfactory,” he said.
He told the Dhaka Tribune that the bank is building infrastructure, such as establishing bank branches in appropriate locations, in a way that will help it to function properly.
The bank is working to build compatible software for the bank’s management so migrant workers never lose money through any fraudulent activities.
Manpower is another drawback that makes the bank’s operations ineffective. They are hoping to solve potential problems by developing appropriate infrastructure.
“We want to build a bank for migrant workers that will be safe and secure within a few years,” said Principal Executive Officer, Md Kamal Hossain.
Bank’s current activities
According to the bank, its core objectives are to increase remittance flow through proper channels, and assist aspiring returning migrant workers by providing loans for migration and rehabilitation.
The bank’s current activities are confined to mostly providing migration loans, as most returning migrant workers apply for rehabilitation loans without proper documents and are denied by the bank.
Statistics show that the bank has provided some 35,408 migration loans amounting to some Tk389.61 crore till May,14 this year. In the same period, the bank has provided rehabilitation loans amounting to Tk2.2 crore to 167 people. In the first four and a half months of 2019, the bank gave migration loans to 6,247 people, highest in its history in terms of a one year period but could approve only six loans to returning migrant workers in the same period.
Bank officials said very few migrants take both types of loans.
About disbursing loans to returning migrant workers, the bank’s MD told Dhaka Tribune that most returning migrant workers who come to the bank for rehabilitation loans seek home loans,which is against bank rules, and improper documents compel the bank to deny them loans.
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“We can’t accept their homes as mortgage. If they fail to repay the loan, we can’t take over their home since it is a matter of basic human rights that comes to the forefront, and the bank can’t afford the loss.”
Although the bank has an effective loan recovery process, it is risking its capital by providing loans to returning migrant workers as they don’t have a stable future. If the returning migrant workers seek loans for business purposes, the bank operates like other normal banks, she said.
Friendly approach and future plans
Several returning migrant workers in discussing the topic with Dhaka Tribune, said the procedure for obtaining loans from PKB is very complicated and they avoid it even if they are in distress.
Independent migration expert, Asif Munier said he is doubtful about the number of returning migrant workers who know about PKB’s services.
“It would be much more effective if the bank’s services are more migrant worker friendly,” he said.
Bank sources said they are trying to make the bank migrant worker friendly with effective approaches, so they do not have to worry about their future after returning home.
Mahtab Zabin said bank authorities are planning to empower family members of returning migrant workers, so that a father, sister, wife or brother, might use a loan as a source of investment or work, when a migrant worker returns home.
“This plan would bring them under the social safety net,” she added.
“We also arrange for migrant workers to make a Fixed Deposit Receipt (FDR) with the bank that would be managed through their bank accounts and help them to make secure and legal transactions,” said MD Mahtab Zabin.
“Depending on their needs, the bank might help them by providing consultation regarding jobs and other investment sources in the country, the MD said.
Principal Executive Officer Kamal Hossain said very few people from the northern districts go abroad. The bank has an active plan of turning these people into a workforce that feels inspired to go abroad for employment so that remittances increase.