The Dhaka Chamber of Commerce and Industry on Monday expressed concern over slowdown in private sector credit growth, which has declined to 6.03 per cent — the lowest in 22 years.
The chamber made the comment when a DCCI delegation led by president Taskeen Ahmed paid a courtesy call on Bangladesh Bank governor Md Mostaqur Rahman at the central bank headquarters at Motijheel in the capital.
Taskeen said that the current policy rate of 10 per cent had pushed lending rates up to about 16-17 per cent, reflecting a liquidity crunch in the banking system and making financing increasingly costly and less accessible, particularly for SMEs and manufacturing industries.
To ease the situation, Taskeen proposed a gradual reduction in the policy rate to lower borrowing costs and encourage private investment.
During the meeting, governor Mostaqur stressed the need for greater focus on cottage, micro, small and medium enterprises and the agriculture sector to boost economic growth and create employment.
He said that the economy has become overly dependent on a limited number of products, services and export markets in recent years, underscoring the urgency of diversification through CMSMEs and agro-based sectors.
‘This will help stimulate the domestic economy and generate employment,’ he said, adding that high logistics and product management costs remained key drivers of persistent inflation.
Highlighting broader macroeconomic challenges, the governor noted that Bangladesh’s GDP growth has been below expectations, affecting both foreign and domestic investment inflows. ‘There is no alternative to reforming business and trade policies and reducing the cost of doing business,’ he said.
The DCCI president suggested introducing subsidised credit facilities for priority sectors, including manufacturing, export-oriented industries and SMEs.
He further noted that a wide spread between lending and deposit rates — exceeding 5 per cent — has eroded investor confidence and contributed to a decline in private investment.
Emphasising the importance of restoring confidence in the financial sector, the DCCI president called for stronger governance in banking and financial institutions.
He also raised concerns over recent changes in loan classification policy, where the timeframe had been reduced from nine months to three months, saying it had added pressure on businesses already grappling with high costs, energy shortages and weak demand.
In this context, he proposed extending the loan classification period to at least six months and reconsidering loan rescheduling facilities for unintentional defaulters.
DCCI senior vice-president Razeev H Chowdhury, vice-president Md Salem Sulaiman, board members and senior officials of the Bangladesh Bank were present at the meeting.
