Digital loans of up to Tk 50,000 without collateral, without visiting a bank, as Bangladesh Bank updates e-loan scheme

Bangladesh Bank has taken an initiative to provide loans of up to Tk 50,000 without collateral at low interest entirely through a digital system.

To this end, the central bank's 'e-loan' refinancing scheme has been updated and, through a circular issued on 9 November, the scheme's tenure has been extended to 30 June 2028. Bangladesh Bank gave this information in a press release.

According to the central bank's instructions, the loans will be distributed through the country's scheduled banks and the entire process, from application to receiving the money, will be completed digitally.

Customers will be able to apply for the loan and receive the money using various digital channels including internet banking, mobile banking apps, mobile financial services (MFS) and e-wallets.

Under the scheme, a customer can take an unsecured loan of up to Tk 50,000 for a maximum tenure of 12 months, where the annual interest or profit rate at the customer level has been set at a maximum of 9 percent.

On the other hand, Bangladesh Bank will provide refinancing facilities at 1 percent annual interest to the banks participating in this programme.

The scheme has instructions to give special priority to several groups in loan distribution. The priority list includes marginalised communities, residents of remote and distant areas and people outside banking services.

In addition, marginalised women, micro and small women entrepreneurs, students holding student banking accounts aged 18 to 25, persons with special needs, persons with disabilities and third-gender customers will also get this loan facility on a priority basis.

Bangladesh Bank's main goal is to bring people outside the conventional banking structure under loan facilities on easy terms. The central bank hopes this initiative will play an effective role especially for those for whom it is difficult to take loans with collateral in the conventional system.

According to the central bank, as a result of this scheme, small loan facilities will become easily available, income-generating activities of marginalised people will increase, and ordinary people's interest in and habit of using various digital platforms including mobile applications in banking transactions will be created.