Bangladesh Bank (BB) has revised key provisions of its Taka 10,000 crore agricultural refinance scheme. The central bank issued a circular replacing Sections 3 and 4 of the original guidelines issued on June 8, 2023. The revised directive states that the Taka 10,000 crore refinance fund will be sourced from the surplus liquidity of scheduled banks maintained under the management of Bangladesh Bank. The refinancing scheme will remain in force for three years from June 8, 2023.
Formalizing the Funding Mechanism
The clarification formalizes the funding mechanism for the scheme aimed at supporting agricultural lending. This move is expected to provide a more transparent and structured approach to utilizing the surplus liquidity of scheduled banks for agricultural finance.
Objectives of the Scheme
Bangladesh Bank said the refinance facility is intended to boost domestic agricultural production, strengthen food security, and promote employment generation by expanding economic activities in rural areas. The scheme is a critical component in the central bank's strategy to support the agricultural sector, which is vital for the country's economy.
Unchanged Provisions
The circular further stated that all other provisions of ACD Circular No. 01, issued on June 8, 2023, will remain unchanged and continue to be effective. This ensures that the core objectives and operational guidelines of the scheme remain intact while addressing the need for updated funding sources.
