FBCCI seeks extension of loan classification facility until June
The central bank earlier extended relaxed conditions for loan repayment until 31 Dec
The Federation of Bangladesh Chambers of Commerce and Industries (FBCCI) has called for extending the moratorium on loan classification until next year's June in consideration of pandemic-induced impacts on businesses.
Md Jashim Uddin, the apex trade body chief, made the call on Sunday while presiding over FBCCI's Annual General Meeting (AGM) of 2019-20, held at the Officers' Club in the capital.
Earlier this year, the Bangladesh Bank extended the loan repayment facility under relaxed conditions until 31 December, and borrowers can avail the opportunity by paying 25% of their loan within the deadline.
"Extending the loan classification period would bring relief to businessmen and speed up the economic recovery," said the FBCCI president.
Asked on the matter, a senior Bangladesh Bank official told The Business Standard, "The loan repayment facility has been repeatedly extended till December this year for the benefit of the businesspeople affected in the pandemic. To my knowledge, there is no possibility to extend the benefits further."
Mostofa Azad Chowdhury Babu, senior vice president of the FBCCI, said they wrote to the central bank on 15 December seeking the facility.
"We sought relaxation of the condition of 25% payment. We think considering the reality, the Bangladesh Bank should issue a circular in this regard as soon as possible. Because, not only the traders, the banks will also suffer if the facility is not extended," he told The Business Standard.
Ahsan H Mansur, executive director of the Policy Research Institute (PRI), told the TBS, "The facility to not pay even 1% of the loan amount and yet seeking not to be listed as defaulters will crush the banking sector."
He, however, added that this facility can be extended on a case by case basis for any company which is really struggling.
Speaking with The Business Standard, Saleh Uddin Ahmed, former governor of Bangladesh Bank, said the FBCCI's demand does not fall within any financial rescheduling principles.
"If such a facility is given, the banks will earn nothing and I think it will be a blow to the banking interests," he added.
Md Jasim Uddin, in his speech at the AGM, also urged the National Board of Revenue not to finalise a new income tax law in a hurry.
"As an income tax law is currently in effect, a new law should be enacted in consultation with all stakeholders, including the FBCCI," he said.