Small scale entrepreneurs, hit by the coronavirus pandemic, are set to get nearly Tk400 crore in loans from the Islamic Development Bank (IDB).
The loans will be given under an agreement signed between the government and the bank last year to help recover the Covid-19 affected cottage, micro, small and medium enterprises (CMSME).
The Bangladesh Bank, in a circular issued on Sunday, informed all chief executives of all banks and non-bank financial institutions to this end.
Under the agreement, Islamic Development Bank will provide a total of Tk398.58 crore as loans to CMSMEs.
The loans will be disbursed through various scheduled banks and non-bank financial institutions per the Shariah policy,
According to the central bank circular, the government signed a framework agreement with IDB on 24 June last year to provide financial assistance to CMSMEs affected by the pandemic. The duration of the project has been fixed at two years from the date loan disbursement begins.
Entrepreneurs with a record of defaulting over 10% of loans in banks and financial institutions are not eligible for the loan. The issue of environment and social security will be prioritised in loan disbursement. The programme will be supervised by the SME and Special Programs Department of the Bangladesh Bank.