• Friday, Aug 19, 2022
  • Last Update : 04:24 pm

Business leaders seek exemplary punishment of bank loan defaulters

  • Published at 11:45 pm February 17th, 2019
FBCCI discussion
FBCCI President Shafiul Islam Mohiuddin addresses the audience during a discussion with business leaders in Dhaka Club on Sunday Dhaka Tribune

They observed that as bad borrowers are not servicing their loans, it has become difficult for honest businessmen and genuine borrowers to get bank loans

Business leaders on Sunday demanded the government provide exemplary punishment to willful loan defaulters.

They observed that as bad borrowers are not servicing their loans, it has become difficult for honest businessmen and genuine borrowers to get bank loans.

The leaders also discussed several recommendations for the next national budget to help trade and economy flourish, at a meeting held at the Dhaka Club.

The Federation of Bangladesh Chambers of Commerce and Industries (FBCCI) organized the meeting.

FBCCI President Md Shafiul Islam Mohiuddin attended as chief guest, while Sheikh Fazle Fahim, senior vice president of the apex trade body, chaired the meeting. Top leaders of various associations also attended the meeting.

Shafiul reiterated that if defaulters do not return the money they took from the banks, then the government should give exemplary punishment so that others are alert about the consequences.

“Banks have failed to keep their promise to bring down interest rates to single digits. On the contrary, they have increased lending rates,” he said.

“82% of the GDP of the country comes from the private sector. The government’s efforts to facilitate growth of the country’s business sector are laudable,” the FBCCI president said.

He emphasized a multilayer VAT system, and expansion of the tax net keeping tax rates stable.

The FBCCI president also said there is a tendency to raise interest rates,let alone reducing lending rates to single digits.

“The interest rates charged by banks have become unbearable,” he alleged.

“It is not conducive for a stable business environment as default loans in our country have exceeded hundreds of crores of Taka.”

He added that the VAT rate should not be a uniform 15% in all cases, as the FBCCI sat with the chairman of the National Board of Revenue (NBR) last week, who also said the VAT rate will not be 15% in all areas, but will be set differently.

President of Fish Farm Owners Association, Samsur Rahman Shaheen, said: "We are fighting to keep bank loan interest rates between 5-7%. While Palli Karma Sahayak Foundation (PKSF) disburses loans to NGOs at reasonable rates, we demand they disburse loans to businessmen as well. Their loans are easier to get, compared to banks.”

Wholesale Edible Oil Association President Md Abul Hashem said, although Prime Minister Sheikh Hasina had asked for single digit  bank interest rates, it did not happen.

“Rather, it is now at 13% on average. He demanded FBCCI provide credit to businessmen should the banks reject their loan applications.

Bangladesh Crockeries Merchants Association president Md Monir Hossain said: “Obtaining bank loans are getting increasingly difficult as the amount of default loans in the country is on the rise.”

Sheikh Fazle Fahim listened to the statements of the association leaders and assured them of taking necessary steps through discussions with the ministries concerned, based on the issues raised at yesterday’s meeting.

The FBCCI senior vice president also said the private sector of the country is working relentlessly to make Bangladesh a developed nation by 2041, considering the eighth five year plan of the government.

“FBCCI has initiated engagement with all the associations to discuss their problems with regard to trade and industry.”

He added that the state owned banks should provide loans to entrepreneurs at single digit rates. But the interest rates of private banks are still not at single digits.