SMESPD Circular Letter No. 01: Regarding disbursement of loan/investment in working capital sector under 25000 crore refinance scheme in CMSME sector

50119

Bangladesh Bank
(Central Bank of Bangladesh)
Head Office
Motijheel, Dhaka-1000
Bangladesh.

04 Magh 1429
SMESPD Circular Letter No.-01 Date: -------------------------- 18 January 2023

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

Regarding disbursement of loan/investment in working capital sector under 25,000 (Twenty-Five Thousand) Crore Taka refinance scheme in CMSME sector.

Reference is drawn to your attention to SMESPD Circular Letter No.-04 dated 19 July 2022 and SMESPD Circular Letter No.-07 dated 08 November 2022 on the subject cited above.

In view of the increased demand for working capital loans/investments alongside term loans/investments by entrepreneurs, and the need for various banks and financial institutions to finance their customers to meet such demand, refinancing facilities are being provided for working capital loans/investments alongside term loans/investments under the aforementioned scheme. However, upon reviewing the refinancing applications submitted by various participating banks and financial institutions, it has been observed that some banks and financial institutions have provided working capital loans/investments for a tenure exceeding 12 months to their customers under conditions of single/variety of installment repayments, which is not consistent with the main characteristics of working capital loans/investments.
In this context, the following instructions are to be followed for providing refinancing facilities against financing of working capital loans/investments under the discussed scheme:
a) The tenure of working capital loans/investments shall be maximum 12 (twelve) months. However, loans/investments disbursed in the working capital sector can be renewed, and banks and financial institutions can reapply to Bangladesh Bank for refinancing against the renewed loans/investments. b) The refinanced funds against working capital loans/investments shall be repaid to Bangladesh Bank by the concerned banks and financial institutions in a lump sum along with periodic interest/profit.
Furthermore, the revised Annexure-'B' and Annexure-'C' attached herewith must be used at the time of submitting the refinancing application.
In addition, the other instructions of the circulars cited in the source shall remain unchanged.
These instructions are issued under the powers conferred by Section 45 of the Bank Company Act, 1991 and Section 18 of the Financial Institutions Act, 1993.
These instructions shall take effect immediately.

Annexure: As described.

Yours faithfully,
(Signature)
(Mohammad Ashiqur Rahman)
Director (SMESPD)
Phone: 9530502

Phone: 88-02-9550448, 9554896, IP: 88-02-9566501-6, Fax: 88-02-953049, www.bb.org.bd

Annexure-'B'

Source: -------------------------- Date: -------------------------- Director (SMESPD) SME & Special Programs Department Bangladesh Bank Head Office Dhaka.

Sir,

Regarding application for obtaining refinancing under the 'Refinancing Scheme for Term Loans/Investments in CMSME Sector'.

In accordance with the instructions of SMESPD Circular Letter No.-04 dated 19 July 2022 on the subject cited above, loans/investments amounting to -------------------------- Taka have been disbursed to -------------------------- CMSME entrepreneurs from -------------------------- Date to -------------------------- Date under the aforementioned refinancing scheme. The instructions mentioned in the circular have been duly followed in the disbursement of the aforementioned loans/investments. The sector-wise distribution of financing under the said scheme so far is mentioned in the table below:

Nature of Entrepreneur	Type of Loan/Investment	Type of Entrepreneur
Production	Term	Cottage, Micro & Small
Service	Working Capital	Medium
Trade

Detailed information (Annexure-'C') regarding the application for obtaining refinancing from the aforementioned refinancing scheme against the described financing is submitted herewith. The information related to the aforementioned application has already been submitted online, the details of which are as follows:

Online Application Date	Online Tracking Number

In this regard, you are requested to provide a total of -------------------------- Taka (in words --------------------------) as refinancing in favor of this bank/financial institution as per the description attached.

Yours faithfully,
(------------------------------------------)
Managing Director/Branch Head
-------------------------- Bank/Financial Institution Phone: -------------------------- E-mail: --------------------------

Annexure:

Information regarding loan/investment (Annexure-'C').

Annexure-'C'

Information regarding loan/investment for obtaining refinancing under the "Refinancing Scheme for Term Loans/Investments in CMSME Sector"

Name of Bank/Financial Institution:
Financing Period:

	Description of Loan/Investment Recipient/Enterprise											Loan/Investment and Refinancing Related Information
Serial No.	Name of Enterprise	Address of Enterprise	Nature of Ownership (Proprietorship/Joint Ownership/Company)	Type/Description of Business/Activity	Type of Enterprise (Cottage/Micro/Small/Medium)	Nature of Enterprise (Production/Service/Trade)	Trade License No.	Name of Entrepreneur/Enterprise	NID No.	Loan/Investment Account No.	Date of Disbursement of Loan/Investment	Type of Loan/Investment (Term/Working Capital)	Purpose of Loan/Investment	Amount of Disbursed Loan/Investment (Taka)	Interest/Profit Rate (%) at Customer Level	Grace Period (Months)	Tenure of Loan/Investment including Grace Period (Months)	Amount of Claimed Refinancing (Taka)	Remarks (if any)
(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)	(9)	(10)	(11)	(12)	(13)	(14)	(15)	(16)	(17)	(18)	(19)	(20)
1
2
3
Total	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-

SMESPD Circular Letter No. 01: Regarding disbursement of loan/investment in working capital sector under 25000 crore refinance scheme in CMSME sector

Lineage: Amended

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