The government has approved a fund of Tk 10.00 billion for Probashi Kallyan Bank (PKB) to meet the present growing demand for its loans among migrant workers. The fund will be given in four installments at bank rate, officials said.
The Financial Institutions Division (FID) under the Ministry of Finance has granted guarantee on some conditions this month against the fund that will be disbursed for managing the PKB's ongoing migration, rehabilitation, and Bangabandhu Immigrant's Large Family Loan schemes.
The Bangladesh Bank (BB) has already given consent in the light of the guarantee, and the PKB has been asked to go for a participatory agreement, said a BB official.
The bank will receive Tk 2.50 billion from the fund in the first installment. Then it will get Tk 2.50 billion more in the second installment - based on the report that the fund has been properly utilised, he added.
As per the FID's conditions, the term of the state guarantee will be valid for 10 years from the date of its issuance. Specific plans should be adopted to reduce deposit deficit and credit-deposit ratio of the bank as well as increase its business scope.
Besides, a comprehensive business plan will have to be prepared and sent to the Finance Division, considering its importance to manage the bank more efficiently and overcome the current fragile situation.
The specialised bank applied for the fund to meet the growing demand for its loans under different schemes, said its managing director (MD) Md Mazibur Rahman.
The PKB needs the fund, as there is a large demand for its loans among the migrant workers. But currently the bank has no fund available for disbursement.
"We cannot receive public deposit for absence of required infrastructure. So, there is no option now but to take the fund from the government to meet our present demand."
But work is in progress to start the PKB's general banking, he added.
About 0.6-0.7 million workers go abroad generally each year. Demand for the PKB's migration loan and its loan disbursement increased in recent years.
According to official data, the bank distributed Tk 7.84 billion loan in the first 10 years since launching its operation in 2011 to provide collateral-free loan to overseas jobseekers for migration and rehabilitation.
The PKB provided Tk 9.0 billion loan in fiscal year (FY) 2021-22. In the current FY, the bank has a plan to disburse Tk 10 billion.
A total of 107,529 migrant workers received loans from the PKB since its inception, of whom majority are migration loan receivers.
It now runs 101 branches across the country and has a plan to set up branch in every upazila. The bank has increased manpower to 450 from 167 in recent times.
