The Jute industry has got a lifeline for two years after which they could pay back any loan installments to the Non-Bank Financial Institutions (NBFIs), after nearly seven months of the same facility extended to the sector by scheduled banks.
The central bank on Thursday asked the NBFIs to transfer all outstanding loans of jute industry to a 'Block Account’ for two years.
After the two-year moratorium, the jute sector will enjoy the facility to clear the outstanding loans in a 10-year period, a circular from the Bangladesh Bank says.
The central bank also asked NBFIs to charge interest equivalent to their costs of fund on the outstanding credit while in the ‘Block Account’.
NBFIs will enjoy the sole authority to scrap the facility in case clients fail to pay at least four installments per annum after the moratorium expires, the circular elaborates.
The industry's borrowing from refinance schemes will not be entitled for the facility.
The NBFIs have also been directed to go through one on one cases and consider records of the bank-client relations.
Officials at the finance ministry said the government decided to provide an extensive payback facility for jute sector.
Asked whether the BB directive would create any inconvenience in such a period when the NBFIs were passing through difficulties, chairman of Bangladesh Leasing and Financial Companies Association (BLFCA) and managing director of National Housing Finance and Investments Ltd, Khalilur Rahman said the leasing companies' investment in jute industry was very minimal and it would not create any pressure.
"We must adhere to the government's initiative for the greater interest," he added.
