Govt plans interest-free house loans for FFs

Hasibul Aman

1 March, 2019 12:00 AM printer

The government is going to create a Tk 3,500 fund to bear the interest of the home loans to be provided to the freedom fighters or their successors.

The decision has been taken in a recent meeting of financial institution division of the ministry of finance, meeting sources said.

The move came in line with a government’s decision to provide interest-free homes loans to the freedom fighters.

The government will bear 5 percent interest on bank loans and the war heroes will have to bear only 2 percent services charge, according to the decision. 

In the meeting, 14 loan conditions were finalised, including Tk 10 lakh loan ceiling and imposition of 2 percent service charge. 

Freedom fighters enjoying government allowance or allowance-recipient prioritised successors of the freedom fighters who have passed away are eligible for the loan. 

The conditions will be incorporated in the draft loan policy for the freedom fighters later, which will be placed before the finance minister for approval after discussing with top officials of state-run commercial banks, sources added. 

“We’re still reviewing the loan issue. It will be finalised after holding discussions with other stakeholders,” commented a finance ministry high official.

Currently, there are 230,349 gazetted freedom fighters in the country of which 70 percent or 161,244 might be eligible for getting the interest-free home loans.

The scheme will require Tk 16,124 crore, which has been decided in the meeting to be distributed in five years. 

According to meeting decision, the government will need Tk 4,837 crore in the first year, Tk 3,225 crore each in the second, third and fourth year and  Tk 1,612 crore in the fifth year. 

The government has to spend Tk 312 crore from the proposed fund to bear loan interest in the first year after loan disbursement. This amount has been proposed to be allocated in each year’s budget.

The loan’s repayment period will be 14 years while the grace period will be nine months. The loan project’s duration will be 16 to 17 years.

For proper utilization of the home loans, it has been proposed not to disburse the whole Tk 10 lakh loan at a time. 40 percent will be provided in first installment, 30 percent three months later and the last installment of 30 percent after three more months.

The financially insolvent freedom fighters and those who have land property below five decimal will be eligible for getting the loan.

There will be no age limit for the living freedom fighters in getting the home loan. The home constructed under the scheme will has to be mortgaged to the banks providing the loans.   

The aspirant loan receiving freedom fighters will have to possess at least two decimal of land in the name of their spouses and the loan applicants’ names must be certified by the Liberation War ministry.

However, those who have already got residents from the government free of cost won’t be eligible for this loan.

State-run, Sonali Bank, Agrani Bank, Janata Bank, Bangladesh Krishi Bank and Rajshahi Krishi Unnayan Bank will provide the loan. Rupali Bank and House Building Finance Corporation might participate in the scheme.