Bangladesh Bank (BB) in a meeting with bankers Tuesday decided there will be no more extensions to the loan moratorium facility beyond December 31.
The facility was first introduced in mid -2020 at the height of the pandemic, and extended several times to allow people falling into hard times to cope.
It means from January 1st, banks can declare loans as classified upon borrowers failing to pay instalments in accordance with the normal rules and regulations.
BB Governor Fazle Kabir announced the decision at a bankers’ meeting at the central bank on Tuesday, said Md. Serajul Islam, its spokesperson.
Under the moratorium, bank clients would not be recorded as defaulters even if they failed to pay any instalments in 2020. In 2021, borrowers to remain out of default needed to pay just 25 percent of their scheduled instalments.
“Some clients are still hoping for the benefit to continue, and also new benefits. But this advantage is no longer available from the New Year,” said Serajul, also an executive Director of BB.
The FBCCI, an apex body of traders, had written to the governor on December 15 for yet another extension to this special facility till June 2022.
They contended economic activities have not returned to normal, affecting traders’ ability to pay, as some are still in dire straits. But the central bank has now decisively rejected the proposal.
Source: United News of Bangladesh