Cut interest rate of microfinance loans: BB governor

Bangladesh Bank Governor Abdur Rouf Talukder today urged the country's microfinance institutions to reduce loan interest rate for the poor.

Making profits from the loans disbursed among the poor should not be the goal, rather the interest rate should be cut significantly for the sake of the poor, he said.

He spoke while addressing a workshop organised by the Microcredit Regulatory Authority (MRA) at Cirdap auditorium in Dhaka.

The microfinance institutions should also take more steps for faster implementation of cashless transaction, the governor said.

The government wants to create a cashless society in the next five years and wants to use mobile phones as both credit cards and banks, he said.

At present, microfinance institutions in Bangladesh disburse around Tk 900 crore a day and Tk 2 lakh crore a year, Talukder said.

The interest rate for microfinance loans should reduce now, as the amount of such loans will increase significantly in the days to come, he said.

"We now have to reduce the use of cash. Binimoy, an interoperable digital transaction platform, was launched on Sunday. With its introduction, transactions can now be made among mobile financial service providers."

At the event, the governor launched four e-services of the MRA to ease the process for providing clients with loan and savings related services.

The e-services are: MRA Info, e-clipping, e-archiving and MRA Library Automation.

At the event, Sheikh Mohammad Salim Ullah, secretary of financial institutions division; Md Fashiullah, executive vice chairman of MRA, and Mohammad Yakub Hossain, MRA director, were also present.