BRPD Circular No. 04: Prudential Regulations for Consumer Financing

website: www.bb.org.bd Banking Regulation & Policy Department Bangladesh Bank Head Office Dhaka-1000 03 April, 2017 BRPD Circular No- 04 Date : ----------------------- 20 Chaitra, 1423

Chief Executives All Scheduled Banks in Bangladesh Dear Sir, Prudential Regulations for Consumer Financing. Please refer to BRPD Circular No. 07, dated November 03, 2004 and BRPD Circular No. 05, dated April 25, 2012 on the captioned subject.

1. The consumer product market in Bangladesh has been growing rapidly over the last few years and rising per capita income has enabled growth in consumer spending. Considering the existing market price and the increasing demand for consumer goods, it has been decided to make changes in Regulation-13 and Regulation-30 of Prudential Regulations for Consumer Financing which now stand as under: REGULATIONS FOR CREDIT CARDS Regulation-13: ''Maximum unsecured limit under credit card to a borrower (supplementary cards shall be considered part of the principal borrower) shall not exceed Tk. 10 (Ten) Lac. The banks may allow financing under the credit card scheme in excess of the limit of Tk. 10 (Ten) Lac provided the excess amount is secured against liquid securities. However, in no case the limit will be allowed to exceed Tk. 25 (Twenty Five) Lac. In case of foreign currency cards, cards can be issued subject to repayment is made against respective foreign currency account or against lien of foreign currency quota allocated to Bangladeshi nationals by Bangladesh Bank from time to time.'' REGULATIONS FOR PERSONAL LOANS INCLUDING LOANS FOR THE PURCHASE OF CONSUMER DURABLES Regulation 30: "Limits per person for such loans will be Tk. 5 (Five) Lac without any securities. However, banks may lend higher amounts provided the loans are secured appropriately. But, in no case, the loan amount will be allowed to exceed Tk. 20 (Twenty) Lac. The loan secured against liquid securities shall however, be exempt from this limit.''
2. Besides, Banks are instructed to provide consumer finance such a way that, in any case, the growth rate in total loans under 'Consumer Financing' must not exceed the growth rate of bank's total loans. This instruction shall come into force with immediate effect. Yours sincerely, (Abu Farah Md. Naser) General Manager Phone: 9530252