While launching a management information system (MIS) that intends to strengthen the monitoring process for banks and microfinance institutions (MFIs), Bangladesh Bank Governor Atiur Rahman urged local non-governmental organizations (NGOs) to agree on a single nationwide interest rate in a “transparent” and “logical” manner. He also strongly encouraged NGOs to pay interest on deposits made by their clients. Supporters of these ideas include Quazi Mesbahuddin Ahmed, Managing Director of the Palli Karma-Sahayak Foundation, a microcredit funding and capacity building organization that partners with local MFIs, who argues that these NGOs’ practice of lending to each client at a different interest rate is both “unfair and should be removed.”
About the Bangladesh Bank:
The Bangladesh Bank, established in 1972, is the central bank of Bangladesh, which aims to regulate the country’s currency, manage the monetary and credit system, and help monitor the growth and development of the country’s industries and institutions.
About the Palli Karma-Sahayak Foundation (PKSF):
The Palli Karma-Sahayak Foundation (PKSF) was created in 1990 in Bangladesh. It intends to provide assistance with microcredit funding and institutional capacity building for microfinance institutions (MFIs) and non-governmental organizations (NGOs) that provide microcredit loans to poor populations in the country.
Bibliography:
[1] The New Nation. BB Governor urges NGOs to fix logical interest rate in microcredit. http://nation.ittefaq.com/issues/2009/12/27/news0707.htm
[2] Bangladesh Bank: http://www.bangladesh-bank.org/
[3] Palli Karma-Sahayak Foundation (PKSF). https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Palli+Karma-Sahayak+Foundation+(PKSF)
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