The caretaker government has set December 31, 2008 as the deadline for sick small and medium business entrepreneurs to repay or reschedule their default bank loans, ministry officials said Thursday.
According to a recent finance ministry directive, a borrower who has taken an amount of loan not exceeding Tk 5.0 million from a commercial bank and defaulted on repayments will come under the purview of the directive.
In the directive the ministry has said the sick units will get the interest waiver for repayment of bank loan.
The directive came against the backdrop of a longstanding demand by the country's apex chamber body and the specialised textile mills and power looms association to this effect, said a senior finance ministry official.
Legal actions, already taken or planned by the banks and financial institutions against the loan defaulters, will remain suspended until the deadline, he said.
The amount of bad loan, mostly with the state-owned commercial banks (SCBs) like Sonali, Agrani and Janata, is quite large. But the finance ministry presently does not have the actual data.
Due to the deadline, the SCBs will have to waive substantial amount of interest against the loans, said the official.
The caretaker government has softened its stance on the country's sick small industrial enterprises following an appeal by the country's apex chamber body to waive interest on loan of sick industries.
The move has been taken to give relief to the sick small industries, the official said.
FBCCI president Annisul Huq has hailed the move saying that a longstanding demand has been met by the caretaker government.
"It will yield positive results for the country's small entrepreneurs, which became sick for various reasons," he said.
It will help them get out of legal complexities over the next six months and improve their business position, he added.
The finance ministry directive asked the central bank, SCBs and state-owned specialised and financial organisations to take necessary measures relating to the matter.
The directive, however, suggested the banks and financial institutions to deal with the matter on the basis of bank-client relationship.
They have also been asked to take legal action against the defaulters after expiry of the deadline.
The government will, however, compensate the SCBs and state-owned specialised and financial organisations for the losses they might incur due to waiver of interest.
