Bangladesh Bank (BB) has extended the deadline for cold storage owners to apply for rescheduling their default loans until November 30, 2023. The extension is due to the fact that a majority of clients have not yet applied for loan rescheduling. In July, the banking regulator announced that banks could reschedule default loans for cold storage, mainly used for preserving potatoes. Banks can allow a maximum of 10 years, including a one-year grace period, for loan repayment, depending on the customer’s relationship.
To facilitate rescheduling, banks will need to separate the balance of classified loans into two accounts, one for the principal and the other for the interest. Interest will be charged on the principal amount, and borrowers will make installments every six months. Cold storage owners can make a down payment and then enjoy the grace period, after which banks can recover the principal amount and interest. This extension comes as cold storage owners, who number 400 in Bangladesh, have faced losses over the years due to various factors, including political unrest in 2013.
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