Special Correspondent :
The government is going to offer a special bailout scheme to the loan defaulting companies and businesses, allowing them to reschedule and repay loans on relaxed terms and conditions.
Business leaders welcome the policy saying if implemented, it will benefit thousands of troubled businesses, borrowers and companies providing them debt relief and thereby leave a long-term positive impact on investment, industrialization and job creation.
They also said that the new loan rescheduling policy should be offered for all so that it cannot pave the way of undue favours to a handful of borrowers and dishonesty.
Finance Minister AHM Mustafa Kamal earlier said that the new policy is a special arrangement for those who are not ‘wilful’ defaulters will come into effect from May 1.
Under the policy, defaulters will be allowed to reschedule their loans for 12 years after making 2 percent down payment against their outstanding loans.
At present, defaulters can reschedule their loans for at most 3 years by providing 10 to 15 percent down payment.
A 7.0 percent simple interest rate will be applied on rescheduling instead of existing compound rate of interest and both large and small borrowers will be able to get the facility for regularising their loans under the new policy.
“We welcome the government’s move which underlines its seriousness to support companies and business firms hit by loan burden,” President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) M Shafiul Islam (Mohiuddin) told The New Nation recently.
He noted that thousands of entrepreneurs have become defaulters mainly due to ups and downs of their business, high lending rates and adverse business climate. Even many fled the country to avoid imprisonment. “Such a difficult situation has forced closure to many factories rendering thousands of employees jobless.”
When asked, Mohiuddin said that the current government is taking up business-friendly policies to supports entrepreneurs and lessen their woes.
“In this context, the government can consider those who have fled the country defaulting loans.”
Mohiuddin also demanded exemplary punishment to those who swindled large sum of money from banks under shady loans.
Terming the new loan rescheduling scheme ‘time-befitting,’ President of the Exporters Association of Bangladesh (EAB) Abdus Salam Murshedy said if implemented, it would help ease the debt burden of thousands of businessmen, as they would be able to service their defaulted loans with simple interest rates instead of compound rates.
“It would also help revive the businesses and investment and create new job opportunities,” he added.
He also thanks the government for formulating such a business friendly policy.
Abdus Salam Murshedy, also a ruling party lawmaker, said that businesses in Bangladesh are rapidly turning unviable due to the high cost of doing business and costly bank borrowing. “The new loan rescheduling policy will help sustain enterprises by reducing their borrowing cost. It will also help promote new investment and jobs.”
He also demanded the central bank to bring down the interest rate to single-digit with a view to enabling businesses to viable and flourish.
Salam Murshedy also supported the loan rescheduling for all the defaulters (small and large), except those who are habitual defaulters.
