B'desh central bank creates $500mn refinance scheme for food security

Dhaka, Nov 18 Bangladesh Bank (BB) has worked out a 50 billion taka ($500 million) refinance scheme to ensure food security in the country as the banking regulator anticipates a possible global food crisis in the near future

A BB circular issued on Thursday said the prices of several food items have gone up in the global market, which is why the central bank has created the fund for farmers to get low-cost loans, reports Xinhua news agency.

Under the scheme, farmers will be able to take loans at an interest rate of 4 per cent.

Banks will be allowed to take loans at an interest rate of 0.5 per cent from the fund, meaning that they will enjoy an interest margin of 3.5 per cent after disbursing the fund to the farmers.

Small marginal farmers can take a single collateral-free loan up to a maximum of 2 lakh taka for the cultivation of crops including rice, vegetables and fruits.

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