Bangladesh Bank has mandated that borrowers of project loans must open revenue accounts in the same bank from which they obtain the loans. This move aims to mitigate risks associated with loan recovery and enhance the monitoring of banks’ loan distribution. The circular specifies that in cases involving multiple banks lending to a single project, the revenue account should be opened in the lead arranger bank.
If a project’s revenue exceeds loan installments, borrowers can open accounts in other banks with the lender’s permission. The central bank’s initiative responds to observed instances of borrowers depositing project revenue in banks other than the lending institution, posing challenges for loan collection and monitoring. Analysts note that this measure facilitates easier adjustment of loan installments from revenue accounts.
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