Consumer loan doubles in 2yrs

The credit for investment in the industrial sector shows Tk 1736.27 crore as of June 2016 while it was Tk 1705.87 crore-- only 2.43 per cent higher compared to the last fiscal

Consumer loans in banks rose 9 per cent to Tk 50,000 crore as of March 31, 2016 in one year, thanks to ‘low investment’ in the industrial sector. 

According to the latest information of the central bank, as of March 31, 2015 the amount of consumer loan reached Tk 46,008 crore. The amount of consumer loans was Tk 27,512 crore in 2014.  
Consumer loans are usually disbursed for purchasing televisions, furniture, fridges, motorcycles and cars, and building houses.
On the other hand, the credit for investment in the industrial sector shows Tk 1736.27 crore as of June 2016 while it was Tk 1705.87 crore-- only 2.43 per cent higher compared to the last fiscal. 
The amount of consumer loans increased by 83.58 per cent in the last two years, the Bangladesh Bank data showed.
Lead economist of the World Bank (WB) Dhaka office, Dr Zahid Hussain, told The Independent that consumer loan is important for banking sector in Bangladesh that helps to improve the lifestyle of the people.
However, he said it should be commercially viable, adding that it will bring negative impact on economy otherwise.
Banks usually set short-term repayment tenure against most types of consumer loans. So, the repayment trend in such types of loans is better than that of industrial loans.
Dr Zahid thinks that the majority of the banks were now facing excess liquidity due to lower loan disbursement in the industrial sector amid dull business.
He further said the interest rate in Bangladesh is still high and discouraging for the investors, while the bank interest rate has decreased globally and came down to single digit.
About non-performing loan, he said the bankers should take decision carefully to provide loans in such cases. 
Banks have recently set the rates of interest at 11-12 per cent on consumer loans for the current fiscal. The rates were 17-19 per cent in 2014.
Banks also disburse significant amount of consumer loans through issuing credit cards to their clients.
The Bangladesh Bank data shows that banks disbursed Tk 9,146 crore to consumers for purchasing TV, fridge and furniture as of March 31, 2016.
Consumer loan disbursement through credit cards stood at Tk 2,848 crore as of March this year. Banks clients took loans worth Tk 2,253 crore to purchase motorcycles and cars as well.
Banks also disbursed personal loans amounting to Tk 1,529 crore against the salary accounts of their clients.

Consumer loan doubles in 2yrs

The credit for investment in the industrial sector shows Tk 1736.27 crore as of June 2016 while it was Tk 1705.87 crore-- only 2.43 per cent higher compared to the last fiscal

Consumer loans in banks rose 9 per cent to Tk 50,000 crore as of March 31, 2016 in one year, thanks to low investment in the industrial sector. According to the latest information of the central bank, as of March 31, 2015 the amount of consumer loan reached Tk 46,008 crore. The amount of consumer loans was Tk 27,512 crore in 2014. Consumer loans are usually disbursed for purchasing televisions, furniture, fridges, motorcycles and cars, and building houses. On the other hand, the credit for investment in the industrial sector shows Tk 1736.27 crore as of June 2016 while it was Tk 1705.87crore-- only 2.43 per cent higher compared to the last fiscal. The amount of consumer loans increased by 83.58 per cent in the last two years, the Bangladesh Bank data showed. Lead economist of the World Bank (WB) Dhaka office, Dr Zahid Hussain, told The Independent that consumer loan is important for banking sector in Bangladesh that helps to improve the lifestyle of the people. However, he said it should be commercially viable, adding that it will bring negative impact on economy otherwise. Banks usually set short-term repayment tenure against most types of consumer loans. So, the repayment trend in such types of loans is better than that of industrial loans. Dr Zahid thinks that the majority of the banks were now facing excess liquidity due to lower loan disbursement in the industrial sector amid dull business. He further said the interest rate inBangladesh is still high and discouragingfor the investors, while the bank interestrate has decreased globally and came down to single digit. About non-performing loan, he said the bankers should take decision carefully to provide loans in such cases. Banks have recently set the rates of interest at 11-12 per cent on consumer loans for the current fiscal. The rates were 17-19 per cent in 2014. Banks also disburse significant amount of consumer loans through issuing credit cards to their clients. The Bangladesh Bank data shows that banks disbursed Tk 9,146 crore to consumers for purchasing TV, fridge and furniture as of March 31, 2016. Consumer loan disbursement throughcredit cards stood at Tk 2,848 crore as ofMarch this year. Banks clients took loans worth Tk 2,253 crore to purchase motorcycles and cars as well. Banks also disbursed personal loans amounting to Tk 1,529 crore against the salary accounts of their clients.