Business Desk :
Default loans in six non-bank financial institutions (NBFIs) more than doubled in just three months until March this year following the withdrawal of loan repayment exemption by the Bangladesh Bank.
The organisations are MIDAS Financing Limited, National Finance Ltd, CVC Finance Limited, Hajj Finance Company Limited, Uttara Finance and Investments Limited and Premier Leasing and Finance Limited. By the end of March, the total default loans of the NBFIs amounted to Tk1,649 crore.
Many financial institutions have been sinking due to corruption by directors and mismanagement. Among 34 NBFIs, 16 are entangled in huge default loans.
According to the Bangladesh Bank, NBFIs recorded Tk66,962 crore disbursed loans at the end of March, with 15.5% of it being classified loans.
Borrowers of banks and other financial institutions were given loan repayment deferral amid countrywide lockdowns imposed to check the transmission of the coronavirus last year.
The repayment deferral was in place for clients of NBFIs from January to December of that year, meaning they were not deemed as defaulters for not paying installments of short and long-term loans during the time.
After the authority discontinued the facility from January this year, the amount in default loans began climbing up. The central bank then reinstated the facility, with mounting pressure from businessmen through a circular issued on 1 September.
According to the circular, if a client pays off half of the total installments of this year against a loan, it will not be classified.
