The central bank has introduced a refinance loan scheme worth $50 million to encourage environment-friendly and automatic brick kilns in the country.

The Asian Development Bank (ADB) has given the fund to the Bangladesh Bank, said a circular issued by the BB recently.

All banks and non-bank financial institutions (NBFIs) are eligible to get the fund from the central bank at 5 percent, while banks and non-banks would charge reasonable interest rates from their clients.

The BB also issued a guideline in this regard.

Of the total fund, $30 million will be disbursed to convert the existing fixed chimney kilns into the improved Zigzag kilns.

The remaining $20 million will be lent to new vertical shaft brick kilns, hybrid Hoffman kilns and tunnel kilns, said the circular.

A commercial bank or an NBFI can get maximum 50 percent of the total project costs from the BB's refinance fund and 20 percent from their own fund.

An entrepreneur must provide the rest 30 percent of the costs.

The repayment period of such loans will be five years, with six months' grace period.

The circular said a bank will have to take prior approvals from the ADB and the BB before disbursing more than $2 million loan for a project. A bank can lend up to $5 million for a single project, it said.

News: The Daily Star/Bangladesh/19-Sep-12