News Desk: Bangladesh Bank has set a maximum interest rate of 8 percent for agricultural and rural loans. From April 1 this year, banks will not be able to charge more interest from customers. Bangladesh Bank issued a circular in this regard on Thursday (April 22) and sent it to the Managing Director (MD) and Chief Executive Officer (CEO) of all scheduled banks.

It said that the interest rate on agriculture and rural loans as a priority sector will be raised on June 22, 2016 reduced from 10 percent to 9 percent. Subsequently, with effect from 1st April, 2020, the interest / profit rate on unclassified loans / investments in all sectors except credit cards was fixed at a maximum of 9 percent.

It is also said that since 2020, the normal economic activities of the country are being disrupted due to the outbreak of Covid-19 in Bangladesh like other countries of the world. As a result, the agricultural sector, like other sectors, has been affected. In this context, it is necessary to reduce the interest / profit rate of loans / investments in the agricultural sector in order to increase the agricultural production including bringing back the farmers to normal productive activities by ensuring low interest credit in the agricultural sector.

In this situation, considering the contribution of agriculture sector in the national economy, the interest rate on agricultural and rural credit / investment / profit / profit has been re-fixed at a maximum of 8 percent instead of 9 percent as a priority sector for increasing agricultural production including bringing back farmers to normal productive activities.

Bangladesh Bank has asked to implement this directive from April 1, 2021.