The government has decided to park 50 per cent of its development and revenue budget with private banks as part of its concerted effort to enforce single-digit interest rate.
The autonomous, semi-autonomous and government companies also will have to keep their 50 per cent of their surplus fund at the lenders, according to a notice issued by the finance ministry yesterday.
The funds will have to be kept with private banks at six percent interest rate.
The government has taken the decision to lower the interest rate on lending to single digit as part of its move to give a boost to investment and employment generation and make the growth momentum sustainable.
The concerned government entities will have to park the remaining half of their deposits with state banks at 6 per cent interest.
The autonomous and semi-autonomous organisations and the government companies will not be allowed to follow the notice for their provident, pension and endowment fund.
According to a government decision, banks will have to fix the interest rate for lending at 9 per cent from April 1.
Finance Minister AHM Mustafa Kamal sat with private banks’ sponsors and managing directors on December 30 last year where they took decision to fix the interest rate for lending at 9 per cent and for deposit at 6 per cent.
“We earlier took a decision to implement single-digit interest rate for only the industrial sector, but now it will be for all sectors except credit cards,” Kamal told reporters after the meeting at the headquarters of Bangladesh Association of Banks (BAB), a forum of private banks’ sponsors.
He made the word at the meeting that private banks would be allowed to hold the government deposit at a higher interest rate than the rate for state run ones.
Prior to that the government placed a bill in parliament on January 14 to bring the surplus money held by 61 state agencies to the national exchequer and utilising the funds to implement development projects.
Finance Minister AHM Mustafa Kamal placed the bill titled “Deposition of Surplus Money of Self-Governed Agencies including Autonomous, Semi-Autonomous and Statutory Government Authorities and Public Non-Financial Corporations to the National Exchequer Bill 2020”.
The surplus funds will be deposited to the national exchequer after keeping aside: their operational costs, additional 25 per cent of the operational costs as emergency funds, money for general provident funds and pension, according to the bill.
The respective organisation can estimate its operational cost.
The agencies have been included in the bill and they will have to deposit the funds to the national exchequer within three months of completion of a fiscal year.