SMESPD Circular Letter No. 02: Incentive facility against loans & advances provided to women entrepreneurs of CMSME sector

Bangladesh Bank Head Office Motijheel, Dhaka-1000 Bangladesh. SMESPD Circular Letter No. 02 Date: 06 Asharh, 1429 June 20, 2022

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

Dear Sir,

Regarding the provision of incentive facility against loans/advances provided to women entrepreneurs of the CMSME sector.

Reference is drawn to your attention to SMESPD Circular Letter No. 08, dated 17/08/2021 and SMESPD Circular Letter No. 09, dated 04/08/2021.

2. Through the aforementioned circular and circular letter, instructions were issued to encourage women entrepreneurs in the CMSME sector by providing a 1% incentive for timely repayment of loans/advances, along with a loan facility at a maximum interest rate of 5%. However, after a considerable period has passed, banks and financial institutions have not been able to play their due role in providing loan facilities under this incentive scheme to the desired customers. As a result, interested borrowers are being deprived of availing this facility declared by Bangladesh Bank. It is mentioned that some banks and financial institutions are facing difficulties in identifying eligible customers for availing the incentive facility, which has come to the notice of Bangladesh Bank.

3. Now, to remove the complexity/difficulty created in identifying eligible customers under the aforementioned circular, it is informed that under the 'Small Enterprise Refinancing Scheme' provided through SMESPD Circular No. 02, dated 05/09/2019, henceforth only women entrepreneurs will be eligible for loan facilities and incentive facilities under this scheme. The interest rate for borrowers under this scheme will be a maximum of 5%, and eligible customers will receive an incentive facility at the rate of 1 (one) percent from Bangladesh Bank for proper and timely repayment/settlement. Additionally, banks and financial institutions responsible for proper loan management will also receive an incentive facility at the rate of 1 (one) percent.

4. To avail the incentive under this scheme, an application must be submitted in accordance with the attached "Sample Form". Furthermore, other instructions mentioned in the circular and circular letter will remain unchanged.

5. 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.

6. These instructions will take immediate effect.

Enclosure: 02 (Two)

Yours faithfully, (Md. Zakir Hossain) Director (SMESPD) Phone: 9530502

Annexure-A-1 Sample Application Form Reference No: Date:----------------- Managing Director SMESPD Bangladesh Bank Head Office, Dhaka.

Sir,

Regarding the provision of incentive facility against loans/advances provided to women entrepreneurs of the CMSME sector.

With reference to the subject mentioned above, it is stated that under SMESPD Circular No. 8/2021 and SMESPD Circular Letter No. 02/2022, all relevant rules and regulations have been fully complied with, and a total of -----(in words: Taka----) has been refinanced for women entrepreneurs in the CMSME sector from July 1, 2021 to date.

The detailed description of the claimed incentive against the said refinancing is mentioned below:

Name of the Quarter: Type of Loan/Investment Amount/Limit of Loan or Investment Amount of Refinancing taken under 'Small Enterprise Refinancing Scheme' against the subject loan Total Amount of Claimed Incentive Amount of Claimed Incentive against the Customer

Short-term Loan

Term Loan

Running Loan*

Total

• In the case of Running Loans, the incentive is calculated against the funded portion.

In this regard, you are requested to take necessary measures to provide a total of ---- (in words: Taka-----------------) incentive facility for the ---- quarter for loans/advances provided to women entrepreneurs in the CMSME sector.

Yours faithfully,

Enclosure: Annexure A-2 (----------------------------) Managing Director/Chief Executive/Head of Bangladesh Operations for Foreign Banks Phone Number: E-mail:

Annexure A-2 Details regarding claim of incentive facility against loans/advances provided to women entrepreneurs of the CMSME sector.

Name of the Bank: Name of the Quarter:

Serial No. Name and Address of Branch Name of Women Entrepreneur Enterprise Address of Enterprise Trade License No. of Enterprise Name of Women Entrepreneur NID No. Mobile No. Type of Enterprise (Hut/Micro/Small/Medium) Loan/Investment Account No. Date of Loan/Investment Approval Tenure of Loan/Investment at Approval Amount of Principal Loan/Investment Approved Rate of Interest/Profit Amount of Principal Loan/Investment Disbursed Amount of Principal Loan/Investment Recovered Date of Disbursement of Loan/Investment Amount of Accrued Interest/Profit during the Considered Period

Amount of Claimed Incentive against the Subject Loan/Investment Bank's Share (1%) Women Entrepreneur's Share (1%) Total (2%)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21=(19+20)