BHBFC seeks Tk 10b budgetary allocation

Rezaul Karim | Published: February 16, 2014 00:00:00 | Updated: November 30, 2024 06:01:00

The Bangladesh House Building Finance Corporation (BHBFC) has sought Tk 5.0 billion budgetary allocation for the fiscal year (FY) 2013-14, and requested allocation of Tk 5.0 billion every fiscal year beginning from FY 2014-15 to continue its lending programmes, sources said.
In a recent letter to the Ministry of Finance, BHBFC managing director Dr. Nurul Alam Talukder said the corporation could not invest in line with people's expectations because of fund shortage.
"We need adequate funds to extend house building financing at district and sub-district level to follow the directives of President Abdul Hamid and Prime Minister Sheikh Hasina. Presently, BHBFC's annual demand for loan is about Tk 10 billion," Mr Talukder noted in the letter.
"The BHBFC is not able to expand its activities at upazila and district levels due to fund crisis. Demand for providing housing loan is there in Kishoreganj, Gopalganj, Sirajganj and Srimangal after BHBFC opened its branch offices in these cities. But we are unable to disburse loans in these areas due to severe fund shortage," said the letter which was sent to the finance ministry recently.
"There is no opportunity to collect funds from any other sources for meeting the demand. Fund crisis will be further acute if the BHBFC does not get financial assistance from the government. Along with it, BHBFC's activities will come to halt after June 2014," the letter mentioned.Â Â Â Â Â
"The living standard of the people of the rural areas, especially district and sub-district level, is increasing gradually. As a result, demand for housing loans is growing in these areas which have attracted us to expand our footsteps to the areas," BHBFC Managing Director said in a letter to the government.
The BHBFC has sought Tk 5.0 billion budgetary allocations for the FY 2013-14 in revised budget, and requested allocation of Tk 5.0 billion per FY beginning from FY 2014-15, an official said.
Last year, the BHBFC sought capital assistance/lending from the government for stepping outside the capital to expand its credit window to the rural areas, concerned sources informed.
Another high official said BHBFC wants to offer home loans to people in the rural areas with high economic activities to expand its lending activity beyond cities and towns, provided it gets capital assistance from the government.
The state owned entity has long been suffering from fund shortage which it had already informed the finance secretary through the board of directors meeting on September 9. The then secretary had given assurance to help in this connection, sources said.
The Ministry of Finance sources said that in the fiscal year 2012-13, the BHBFC received only Tk 400 million as loan from the government. It could not mobilise any other fund for its lending purposes.
The BHBFC provides house building loans in Dhaka and Chittagong metropolitan cities at a lending rate of 12 per cent, while it is 10 per cent for other cities and towns.
There are plans by BHBFC to expand its activities through setting up an office in every district gradually.Â Now the organisation is operating 29 offices across the country.
The corporation's lending remained suspended from 1988 to 1992 due to fund shortage, sources said.