Earlier the highest rate of interest was 9 percent. But the central bank retreated from its previous position of setting a fixed interest rate.
At present, the interest rate on the loan is decided following the six-month moving average rate of Treasury Bills (SMART) method. Earlier, 3.5 percent additional interest was added to this base rate, but this time Bangladesh Bank has asked to add 3 percent interest. Banks determine the final interest rate of the loan by combining the base rate and additional interest.
At the end of March, the smart rate increased to 10.55 percent. After adding 3 percent interest to this, the interest on the loan becomes 13.055 percent.
Traders said that due to the new policy adopted by the central bank, interest rates on loans are now increasing every month, creating problems for borrowers, traders and industrialists as they will have to pay more interest. He said that as a result the cost of doing business is also increasing.