Banks to spend Tk116cr more on CSR

Banks will have to spend around Tk116 crore in addition to their regular corporate social responsibility (CSR) budget to support slum dwellers, homeless and unemployed people during the Covid-19 crisis.

The Bangladesh Bank on Monday directed banks to introduce a special CSR fund by allocating 1% from their net profit for the year 2020. This additional amount will have to be disbursed by June this year.

The central bank estimated that 1% of total net profit of the banking sector for the year 2020 will be around Tk 116 crore.

Banks spent around Tk 648 crore in the year 2019 for CSR purpose, which was 28 percent less than that of the previous year.

The figure was Tk905 crore in 2018, and Tk744 crore the year before, according to the Bangladesh Bank data.

According to the new circular, banks have to spend 50 % of the special CSR in the city corporation area and also to spend the remaining 50 % at the district / upazila / union level. Banks have to ensure that spending is not concentrated in any particular area.

Since this additional money has to be spent in a short period of time as a special CSR, this money can be adjusted as expenditure in the CSR sector in three years from 2022 to 2024.

Special CSR fund will be spent to meet the medical expenses including daily necessities, health care and in making livelihood of unemployed people, according to the central bank directives.  

In this case, banks will have to spend CSR money for slum dwellers, destitute and for the families of those who are temporarily unemployed due to Covid-19 in the city corporation areas.

Special CSR money will have to be spent for the poorest, temporarily unemployed and marginalized people in different districts who are unable to make a living due to Covid-19.

Banks will have to conduct the special CSR activities with the help of the concerned Deputy Commissioner or NGOs or micro-lenders or both.

The Association of Bankers Bangladesh (ABB) will be the coordinator and facilitator for conducting special CSR activities. Banks can take ABB's help in contacting the Deputy Commissioner and NGOs or microfinance institutions.

The special CSR report has to be submitted to the general manager of the Sustainable Finance Department of the central bank by 30 July, 2021.