Finance minister said single digit interest rate will be implemented from April 2020
Apparel sector business organisations including the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) on Tuesday urged Finance Minister AHM Mustafa Kamal to implement the single digit interest rate on bank loans from January 1 as it had been decided.
On Monday, the finance minister said the single digit interest rate will be implemented in April 2020 instead of the previously fixed date.
The BGMEA sent a letter to the finance minister on Tuesday, demanding implementation of 9 percent interest rate from Wednesday, January 1, 2020.
The textile and garment industries are now facing various sorts of crisis, including increasing operating costs, to survive, it said.
It urged the government on behalf of garment businesspeople, the Bangladesh Knitware Manufacturers and Exporters Association, and the Bangladesh Textile Mills Association to help these sectors to survive the situation by applying single digit interest rate on loans from commercial banks from the previously fixed date.
The BGMEA also called upon the finance minister to direct the commercial banks to make necessary steps to that effect.
After holding a meeting with bank directors and chief executives on Monday, the finance minister said the single digit rate will be applicable to all types of loans except credit card interest rates.
"We wanted to implement the single digit interest rate from January 1. But Prime Minister Sheikh Hasina desires it for all loans, so we decided it should be implemented from April," Mustafa Kamal said.
"We have also decided that no banks can offer more than 6 percent interest rate for deposits," he added.
"To help implement this interest rate, government deposits will be equally distributed between the state-owned banks and private banks," the finance minister further said.
He hoped that implementing single digit rates for all loans would not impact the profits of the banks.
Previously, Mustafa Kamal had declared that only the manufacturing sector would enjoy the single digit interest rate from January 2020. The Bangladesh Bank had formed a committee on December 1 for implementing the single digit rate.