Many small entrepreneurs and low-income professionals fail to secure bank loans due to a lack of required documentation and financial capacity. To bring this population under the formal banking system, Bangladesh Bank has established a refinance fund of Tk 1,500 crore.

Under this central bank fund, commercial banks will access refinancing facilities at an annual interest rate of 1 percent and will disburse loans to clients at 7 percent interest. Individual borrowers can receive a maximum of Tk 10 lakh, while loans up to Tk 5 lakh will require no collateral.

For group lending, the maximum ceiling has been set at Tk 40 lakh. The loan tenure is five years.

Official notification issued

The Financial Inclusion Department of Bangladesh Bank issued a circular on Thursday regarding the scheme. According to the notification, farmers, small traders, low-income professionals, women entrepreneurs, students, members of expatriate families, and individuals affected by disasters will receive priority in accessing these loans.

Who benefits

Rickshaw pullers, tea stall owners, masons, and other low-income professionals, along with students, will be eligible for this credit facility. The initiative aims to address the long-standing issue of small entrepreneurs being excluded from formal banking due to paperwork and financial eligibility barriers.