BB allows new entities to assess credit worthiness of borrowers

The Bangladesh Bank has decided to allow private individuals and companies to form ‘credit bureaus’ to assess borrowers’ loan eligibility and repayment capacity. These bureaus will collect data from sources like the central bank’s Credit Information Bureau and provide lenders with credit ratings, helping make informed lending decisions. With a minimum paid-up capital of Tk 10 crore, the licensed bureaus aim to reduce information asymmetry, increase lending competition, and eventually lower default and interest rates through improved credit information sharing. The central bank has issued guidelines on licensing and regulating these new credit assessment entities.Photo: Star/File