The Bangladesh Bank has decided to roll out a stimulus package of Tk 500 crore to support people who migrated back to their villages due to the ongoing economic hardships. A large number of urban people who lost their jobs at the height of the coronavirus pandemic are now leading a difficult life without employment in villages. This will put an adverse impact on the rural economy, which is why the BB has decided to bring these people under the stimulus package titled Refinance Scheme for Ghore Fera (the homecoming).
Under the scheme, the returnees will be able to get funds at six per cent interest rate. Lenders will get funds at 0.5 per cent interest, meaning they will enjoy an interest margin of 5.5 per cent for management of the loans. Borrowers who will avail Tk 1 lakh to Tk 2 lakh will be allowed to repay the loan in 18 months, which include a grace period of three months. The repayment tenure will be two years, including a six-month grace period, if the amount of loan ranges between Tk 2 lakh and Tk 5 lakh. The tenure of the refinance scheme will end on 30 October 2024. A study has found that 27.3 per cent of the urban population temporarily migrated from cities, particularly Dhaka depleting savings due to lockdown extensions and rising expenses, mainly house rent and utilities.
The central bank expects the rural economy to boost if jobs can be generated for the returnees with this financial support. The BB has selected eight sectors to provide the fund – for local businesses with small capital; purchase of small vehicles in the transport sector; light engineering; fisheries and livestock; setting up service centres for information technology; cultivation of vegetables and fruits; purchase of agriculture equipment; and building and repairing houses. The initiative looks good, its challenges remain in proper implementation and monitoring.
