Bangladesh Bank (BB) has issued new instructions regarding instalments of term (industrial) loans and housing loans after raising interest rates.
The BB instruction stated that following the new method of calculating the bank loan interest, the increased amount of loan instalments is problematic for the customers. The central bank said, there is a need to consider the matter of rescheduling the loan instalment without increasing the figure of loan each instalments.
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According to the circular, the adverse global economic situation, both smart and market-based interest rates are higher than the fixed interest rates before July 1, 2023, and the amount of installments payable by industrial enterprises and individual house construction borrowers has increased. In this situation customers are facing problems.
In order to maintain the trend of industrialization and export and to maintain the repayment capacity of borrowers with limited income, the BB instructed to consider the issue of rescheduling the existing term loan and housing loan installments without increasing the instalment amount.
In this situation, the central bank has issued some instructions regarding the collection of installments of term industrial loans and consumer loans disbursed before July 1, 2023.
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According to the instructions, the period required for collection of instalments can be extended. Extension of time in case of such recovery shall not be treated as debt restructuring under BRPD Circular No. 16 / 2022.