SFD Circular Letter No. 02: Regarding Dedicated Sustainable Finance Help Desk

Sustainable Finance Department Bangladesh Bank Head Office Dhaka.

SFD Circular Letter No. 02 Date: 18 September 2022

3 Ashwin 1429

Managing Director / Chief Executive Officer All Scheduled Banks and Financial Institutions operating in Bangladesh

Dear Sir,

Subject: Regarding the operation of the Dedicated Sustainable Finance Help Desk.

1. Reference is made to SFD Circular No. 1/2021 and Circular Letter No. 05/2020 issued by the Sustainable Finance Department.

2. Although instructions were previously issued directing all scheduled banks and financial institutions to establish Dedicated Sustainable Finance Help Desks at their head offices/branches to accelerate green and sustainable financing (including green financing), and to operate these desks under the supervision of the 'Sustainable Finance Unit' at the head office, it has been observed that the operation of the Dedicated Sustainable Finance Help Desk is not meeting expectations, and the target for green and sustainable financing is not being achieved.

3. In this context, the following instructions are issued to ensure the achievement of green and sustainable financing targets by banks and financial institutions:

a) The head offices of banks and financial institutions shall determine separate targets for green and sustainable financing for their branches/sub-branches/units/regional offices/help desks. The achievement of these targets shall be monitored by the Dedicated Sustainable Finance Help Desk, with strict oversight ensured through the Sustainable Finance Unit at the head office.

b) Banks and financial institutions shall arrange appropriate training/awareness programs for employees and officers deployed at all branches/sub-branches/units/regional offices/help desks regarding green and sustainable financing, as well as awareness/training programs for existing and potential customers/borrowers on the same subject. To this end, they shall prepare a weekly training schedule and ensure its proper implementation. In this regard, the 'Green Banking Guide' may be used.

c) Banks and financial institutions shall establish Dedicated Sustainable Finance Help Desks and deploy necessary manpower at all their existing offices/branches in every district of the Dhaka and Chittagong divisions, as well as in every district of other divisions.

d) The Dedicated Sustainable Finance Help Desk of banks and financial institutions shall prioritize all activities related to green and sustainable financing, including providing advice and processing loan applications, ensuring the fastest possible service delivery.

e) The Dedicated Sustainable Finance Help Desk of banks and financial institutions shall properly implement received green and sustainable financing applications or any related complaints. A separate register shall be maintained for received complaints, and arrangements shall be made for rapid resolution through tracking of such complaints.

f) The branches/sub-branches/units/regional offices/help desks of banks and financial institutions shall maintain an orderly database of existing and potential borrowers, producers, suppliers, service providers, and SMEs regarding green and sustainable financing.

g) The branches/sub-branches/units/regional offices/help desks of banks and financial institutions shall identify at least 3 entrepreneurs annually, provide them training on green and sustainable financing, and ensure that at least 1 entrepreneur among them obtains financing in the said sector.

h) Banks and financial institutions whose loan distribution programs are centrally managed through a head office-based central system shall establish Dedicated Sustainable Finance Help Desks at their major branches/sub-branches/units and operate their programs there.

i) Banks and financial institutions shall mandatorily submit progress reports on the activities of the Sustainable Finance Unit to their Sustainable Finance Committee and Risk Management Committee on a monthly and quarterly basis, respectively.

j) Banks and financial institutions shall submit a report to this department by inserting the information/data as per the table in Annex-1 within the last working day of the month following each quarter.

k) The said report shall be considered an integral part of the Green Banking Report.

l) All branches of banks and financial institutions shall display the (periodically updated) Green and Sustainable Financing Checklist issued in SFD Circular No. 5/2020 dated 30 December 2020 in visible places at their branches. Additionally, branch managers of banks and financial institutions shall display the quarterly branch activity report regarding the said financing on the Notice Board.

m) Banks and financial institutions shall provide the best opportunity for employees and officers deployed at the Green Banking Cell and Dedicated Sustainable Finance Help Desk to reflect their experiences and training. However, capable replacements shall be appointed in place of transfers of employees and officers deployed at the said Cell and Desk.

n) Banks and financial institutions shall prioritize and ensure rapid service delivery in the field of green and sustainable financing according to the needs of women entrepreneurs, disadvantaged groups of society, the elderly, and persons with physical and mental disabilities.

o) Banks and financial institutions may consider providing collateral-free financing facilities for green and sustainable financing based on bank-customer relationships from their own sources. Furthermore, they may provide a joint venture grace period facility to customers as needed in the said financing.

4. These instructions are issued under the powers conferred by Section 45 of the Companies Act, 1994 and Section 18(6) of the Financial Institutions Act, 1993, and shall come into force immediately.

Yours faithfully,

Enclosure: (Annex-1)

(Khandaker Morshed Milson) Director (SFD) Phone: 9530320

Annex-1

S/N | Subject | Number/Amount/Value 1 | Total number of branches 2 | Number of Dedicated Sustainable Finance Help Desks 3 | Total number of employees/officers deployed at the said Desk 4 | Number of employees/officers deployed at the said Desk who have undergone training 5 | Have separate targets for green and sustainable financing been determined for each said Desk? 6 | Number and amount of applications received for sustainable financing through the said Desk 7 | Number and amount of loans approved against applications for sustainable financing through the said Desk 8 | Has at least 1 entrepreneur been provided financing in the said sector after identifying at least 3 entrepreneurs annually and providing them training on green and sustainable financing? 9 | Number of complaints received regarding sustainable financing through the said Desk 10 | Number of complaints resolved regarding sustainable financing through the said Desk 11 | Have Dedicated Sustainable Finance Help Desks been established at all their existing offices/branches in every district of the Dhaka and Chittagong divisions as well as in every district of other divisions? 12 | Number of said Desks where sustainable financing loans were not approved/distributed 13 | Are progress reports of the Green Banking Cell regularly submitted to the Sustainable Finance Committee and Risk Management Committee/Executive Committee?

Quarterly Progress Report on the Operation of the Dedicated Sustainable Finance Help Desk Sustainable Finance Department