Dhaka: Bangladesh Bank (BB) has announced a significant update to its credit card policy, raising the loan limit to Tk 40 lakh from the earlier cap of Tk 20 lakh. This initiative is intended to foster a cashless ecosystem in the country.
According to United News of Bangladesh, the central bank has also set a maximum interest rate of 25 percent on credit card loans. The new regulations permit banks to offer unsecured loans up to Tk 20 lakh and secured loans up to Tk 40 lakh. Previously, these limits were Tk 10 lakh and Tk 20 lakh, respectively.
The updated policy allows cardholders to withdraw up to 50 percent of their credit limit in cash. The central bank emphasized that these changes aim to simplify the use of credit cards as an alternative to cash, enhance risk management, safeguard consumer rights, and promote responsible lending practices.
The policy specifies that the 25 percent interest rate applies solely to the outstanding balance, not the total bill. Interest-free periods remain applicable to purchases, but are not extended to cash withdrawals.
In terms of fees, the guidelines mandate that no charges should be imposed before the activation of a card. Late payment fees are restricted to once per billing cycle, and banks must inform cardholders of any changes in interest rates or charges at least 30 days in advance through written or electronic communication.
To prevent customer harassment, the guidelines strictly forbid banks or recovery agents from engaging in any form of physical or mental harassment. Privacy regarding the cardholder’s family, friends, or referees must be respected.
Recovery-related communication is limited to standard office hours, and banks are required to provide 24-hour helplines for cardholders to block cards promptly in case of loss or theft.
Eligibility criteria for obtaining a credit card include being at least 18 years old, possessing an e-TIN certificate, and having a clean Credit Information Bureau (CIB) report. Students aged 16, who are dependents of a primary cardholder, may apply for supplementary cards.
This new policy supersedes the guidelines that were in place since 2004.