Bangladesh Bank has launched three new refinancing schemes worth a combined Tk 16,000 crore to ease working capital shortages in the cottage, micro, small and medium enterprise (CMSME) sector, increase agricultural production and economic activities in rural area, and promote environmentally sustainable industrial investment.
The central bank issued separate circulars on Monday, saying the funds would support employment generation, business expansion and greener industrial growth at a time when many enterprises continue to struggle with limited access to affordable financing.
The larger scheme, worth Tk 10,000 crore, has been created to increase agricultural production and economic activities in rural area.
The larger scheme, worth Tk 5,000 crore, has been created to provide working capital support to CMSME entrepreneurs.
The fund, titled the CMSME Working Capital Refinance Fund, will initially remain in operation for three years.
According to the latest Bangladesh Bureau of Statistics data, the country has about 11.8 million CMSME enterprises.
Bangladesh Bank said inadequate working capital supply compared with demand has constrained the growth of the sector and hindered employment creation despite its significant contribution to production, services and economic activity.
Under the scheme, entrepreneurs will be able to obtain loans or investments at a maximum interest rate of 9 per cent, while banks will receive refinance support from Bangladesh Bank at 4 per cent interest.
Participating banks will have to pay interest to the central bank on a quarterly basis.
The central bank said the fund aims to help operational CMSME enterprises that are unable to utilise their full production or business capacity because of working capital shortages.
Entrepreneurs receiving financing under the scheme may enjoy a grace period of three to six months before repayment begins.
Borrowers listed as loan defaulters in the Credit Information Bureau will not be eligible for financing.
Bangladesh Bank said that banks with a loan-to-deposit ratio exceeding 70 per cent would receive priority in accessing the fund, although no bank would be allowed to exceed the regulatory ceiling for lending.
Alongside the CMSME facility, the central bank has introduced a Tk 1,000 crore revolving refinance scheme for green industries and green factory buildings.
The fund will support investments in environmentally sustainable industrial facilities that meet internationally recognised certification standards such as LEED, EDGE, BEEER and GreenARCH.
These standards assess energy efficiency, water conservation, waste management and environmental performance.
The refinancing facility will be available for terms ranging from three to ten years.
Bangladesh Bank will provide funds to participating banks at 2 per cent interest, while banks will be allowed to charge borrowers a maximum of 5 per cent.
Only term loans will qualify for refinancing under the green financing scheme. Individual borrowers will be eligible for financing of up to Tk 100 crore, while project sponsors must contribute at least 30 per cent of the total project cost from their own resources.
Private and foreign commercial banks will be eligible to participate if their classified loan ratio remains below 10 per cent, although Bangladesh Bank may relax the threshold up to 15 per cent in specific cases.
The three schemes will operate as revolving funds, allowing repaid amounts to be reused for fresh lending.
The central bank said it would conduct inspections and audits to ensure proper utilisation of the funds and warned that misuse or reporting failures could lead to penalties and recovery actions.
