Customers of non-banking financial institutions will not be defaulters if they repay, by 31 August, at least 50% of loan installments due in June.
But the balance of the installment has to be paid with the next installment, according to a circular issued by the Department of Financial Institutions and Markets of the Bangladesh Bank on Monday.
Earlier, the same facility was provided for banks on 27 June.
The circular said the facility is being provided to maintain the momentum of the ongoing economic activity and mitigate the negative impact of the worsening coronavirus situation on trade and commerce.
In order to tackle the negative impact of the ongoing pandemic, the facility of non-payment of loan installments of banks and non-banking financial institutions, in addition to stoppage of loan classification, was also provided throughout the last year.
In this year, at first, the facility was extended till March depending on the type of loan. It was later extended to 30 June.
However, in the face of demands from various parties including businessmen, the central bank this time provided the customers with the facility of paying half the installment, instead of not paying the full installment, to avoid being defaulters.
The circular said no penalty interest, additional charges, fees or commissions can be imposed on the loans till August 31.
If the interest or profit of the loan, to which the facility is being provided, is recovered, it can be transferred to the income of the financial institutions. Apart from this, other existing policies related to loans and interest will remain in force.
Financial institutions are burdened with bad debts. The default rate in this sector is much higher than in the banking sector.
At the end of September last year, the amount of defaulted loans of non-banking financial institutions stood at Tk10,245 crore, which is about 15% of the total loans disbursed. In the banking sector, the rate was about 10%.
At present, there are 34 non-banking financial institutions. Among those, at least 10 are in critical condition. They are not able to return money on time to customers.
PK Haldar has created the biggest example of financial irregularities. At least five financial institutions have sunk due to his corruption.
A fact-finding committee was formed in February to find out the central bank officials who were accomplices in PK Haldar's corruption. The committee is expected to submit its final report this month.