Staff Correspondent

Government officials have requested the central bank to relax the eligibility clause that bars them from availing of the Tk 300-crore home loan refinancing scheme launched by the Bangladesh Bank.

The scheme, initiated in July, offers low-cost and easy term loans to help middle-class people buy apartments in cities and suburbs.

One of the criteria of the scheme stipulates that anybody employed in an organisation that offers housing loan facility is not eligible for home loans under the refinancing scheme.

A group of civil servants in applications argued that they could take a maximum of Tk 1.2 lakh housing loan from the government, which was too small to buy a flat in any city.

The application is under consideration and the central bank will take a decision on it shortly, an official of Bangladesh Bank said.

The central bank scheme offers long-term housing loan at 10 per cent interest rate to be channelled through commercial banks and other financial institutions. It will create some pressure on the banks and leasing companies to lower home loan interest rates, which average 14 per cent, the official hoped.

Commercial banks and lease financing companies, which offer housing loans, do not have any product for target groups, he pointed out.

Monthly instalment under the central bank scheme will be quite reasonable and close to the amount a borrower spends on house rent, he added.

The official, however, admitted that the loan amount offered under the scheme would not be enough to buy an apartment of 1250 square feet size. 'An individual borrower will have to have Tk 10-15 lakh as equity.'

Service-holders or businessmen, whose monthly incomes are less than Tk 30,000, can apply for a maximum of Tk 20 lakh loans to buy an apartment of size not exceeding 1250 square feet. The loan is repayable in 20 years with one year grace period.

Already a number of banks and financial institutions signed participation agreement with Bangladesh Bank.

They include National Credit and Commerce Bank, Mercantile Bank, Prime Bank, Mutual Trust Bank, Trust Bank, Southeast Bank, National Bank, Asia Bank and One Bank. The financial institutions are Delta Brac Housing, National Housing, IDLC, United Leasing, IIDFC, Lanka Bangla, Fidelity Assets, Midas Financing, Prime Finance, International Leasing, Peoples Leasing, Phoenix Finance and GSP Finance.

Of them, DBH has already received Tk 55 lakh from the central bank under the refinancing scheme.

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