BB drafts a policy to administer lending and repayment.

Lack of a policy to repay default loans against credit card is taking a heavy toll on default clients who allegedly face threats and harassment from the issuing banks.

Treated as consumer financing, the credit card loans are charged with high interests by the banks that have no definite policy to recover the loans.

As a result, the cardholders face problem if they default as the banks do not allow the credit card loans to reschedule or any chance to pay the dues through installments favouring the clients.

Banks recover the money from credit card defaulters, allegedly issuing threat and harassing them physically and socially. 

However, Bangladesh Bank recently moved on issuing a policy over the credit card loans to solve the emerging problems. It has already made a draft policy in this regard. 

The policy includes a clause that any verbal or physical harassment or threats to customers, their family members, references or friends shall not be resorted in the recovery process. 

At the issuance of credit card, the issuer should properly communicate with the customer about the procedure of recovery in case of default payments.

But they should not engage in any activity against public interest and must use the principles of honesty and good health, said the policy.

The policy also prohibited banks from offering unsolicited loans to the customers based on the credit cards. 

It, however, did not offer any way forward for cardholders to come out of default situation by paying off loans. 

Though Bangladesh Bank discourages consumer financing, car loans and house building loans are allowed to reschedule when defaulted, said a senior executive of Bangladesh Bank. 

The cardholders, however, are treated as defaulter like other defaulters if failing to pay the dues in scheduled time, but they are not allowed to get installment or rescheduling facilities for paying off the loans, he said. 

He said credit card loans also can be rescheduled like other loans following the rescheduling policy because the nature of the credit card loan is similar to that of regular loans. 

But the banks are reluctant to go to the rescheduling process as the loan amount is not significant to them, he said. 

Banks would rather like to recover money allegedly by forcing clients instead of following legal procedure to avoid extra hassle for the little amount of credit card loans, he observed.