Disbursement under Bangladesh Bank’s Tk20,000 crore refinancing scheme for reviving closed factories has reached Tk560 crore, up Tk450 crore in 18 days, although many businesses are still waiting for funding.
According to the central bank’s latest data, applications worth Tk1,490 crore had been submitted under the scheme by October 18. Of this amount, Tk560 crore had been disbursed, while loans worth Tk929 crore were awaiting disbursement.
As of October 1, Bangladesh Bank had received applications worth Tk800 crore, against which only Tk110 crore had been released to eight companies.
The central bank announced the scheme in June, but banks took until October to complete the application and scrutiny processes.
Under the scheme, businesses apply through commercial banks, which assess their financial viability before forwarding approved applications to Bangladesh Bank for refinancing. Although the central bank provides funds at lower interest rates, commercial banks bear the full credit risk and are responsible for assessing borrowers’ business prospects.
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) said it had issued eligibility certificates to around 200 garment factories after audits confirmed they met the scheme’s criteria. However, the association said none of those factories had received funding.
“To our knowledge, not a single factory has received funds under this scheme so far,” BGMEA Vice-President Md Shihab Uddoja Chowdhury said.
Four factory owners also told The Business Standard that they were still waiting for the funds.
When the package was launched, Bangladesh Bank Governor Md Mostakur Rahman said it could create around 25 lakh jobs. Of the total Tk60,000 crore allocated across 15 refinancing schemes, Tk41,000 crore was earmarked for refinancing, with Bangladesh Bank set to contribute Tk19,000 crore from its own funds.
### Mixed performance across refinancing schemes
Bangladesh Bank’s data show that the 15 schemes had received applications worth Tk14,519 crore against a combined allocation of Tk60,000 crore. Banks had disbursed Tk11,959 crore, while another Tk2,560 crore was being processed.
The Pre-shipment Credit Refinance Scheme recorded the highest disbursement at Tk6,917 crore, exceeding its Tk5,000 crore target by 38.34%.
The Cottage and Micro Sector Entrepreneurs Special Scheme disbursed Tk2,500 crore against its Tk5,000 crore allocation, while the Creative Economy Scheme fully disbursed its Tk500 crore allocation.
The CMSME Working Capital Refinance Fund released Tk907.73 crore against Tk5,000 crore, while the Overseas Employment Financing Scheme disbursed Tk200 crore against Tk1,000 crore.
Several schemes recorded limited progress. The Agriculture and Rural Food Security Refinance Scheme disbursed Tk292.90 crore against Tk10,000 crore, while the Agro-based Special Economic Centre in North Bengal released Tk48.67 crore against Tk3,000 crore.
The Start-up Sector Financing Scheme recorded Tk32.59 crore in disbursements, with another Tk5 crore under processing against its Tk500 crore allocation.
The Unemployed Youth Employment Financing Scheme had applications worth Tk1,000 crore under processing against an equal allocation, with no disbursement recorded as of October 15.
Similarly, the Green Factory Building and Green Industries Refinance Scheme had Tk527.47 crore under processing against Tk1,000 crore, while the Leather Goods and Footwear Export Sector Scheme had Tk98 crore under processing against Tk2,000 crore. Neither scheme had recorded any disbursement.
Three schemes — the Export Diversification Refinance Scheme, the Rural Economic Activity Dynamics Scheme, and the Frozen Shrimp and Other Fish Export Sector Scheme — had recorded neither disbursements nor funds under processing. Their combined allocation stood at Tk6,000 crore.
The slow release of funds under several schemes raises questions about how quickly the refinancing facilities can reach struggling businesses and deliver the intended benefits in employment and economic recovery.
