The central bank has formed a re-financing fund of Tk 1.0 billion to promote the country's new entrepreneurs in cottage, micro and small sector, officials said.
"We've formed the fund aiming to create employment opportunities through promoting the new entrepreneurs in cottage, micro and small sector across the country," Bangladesh Bank's (BB's) SME and Special Programmes Department general manager Masum Patwary told the FE Thursday.
The central bank expects that the new entrepreneurs in the sector will be benefited from the re-financing scheme, Mr. Patwary added.
"Different entrepreneurs and initiatives including women, information and communication technology (ICT), both export-oriented and import substitute, will be given priority for sanctioning such loan," he explained.
Under the scheme, the banks and non-banking financial institutions (NBFIs) are allowed to disburse the loan to the new entrepreneurs at maximum 10 per cent interest.
The central bank will provide the fund to the commercial banks and the NBFIs at 5.0 per cent interest rate.
The BB issued a circular in this connection Thursday and asked the chief executive officers and managing directors of all scheduled banks and NBFIs for taking necessary measures to provide such loan.
New entrepreneurs will have to bear 20 per cent of the total project cost, according to the circular.
Under the provisions, interested commercial banks and NBFIs will have to sign a participatory agreement with the SME and Special Programmes Department of the BB.
After signing the deal, the banks and NBFIs will be regarded as participating financial institutions (PFIs), according to the BB officials.
Funding supports under the scheme will be available for working capital, mid-term and long-term investments. The tenure will be one year for working capital investment, three years for mid-term investment and five years for long-term investment.
