Bangladesh News

Finance and Planning Adviser Mirza Azizul Islam yesterday asked bankers not to harass clients during transactions. He criticised the banks for maintaining a bigger than normal spread between borrowing and lending rates.

“We have heard about complaints of harassing clients when they open accounts and withdraw money from their accounts. It is not the duty of bank officials to ask what a customer will do with the money they are withdrawing,” Aziz said.

Bank officials should be careful in rendering their service and avoid harassing customers. Their duty is to send transaction reports to Bangladesh Bank, Aziz said at a conference of Agrani Bank’s zonal heads at Hotel Sheraton in the city.

Businessmen have on several occasions blamed banks for harassing clients at the time of withdrawing and depositing funds and charging high interest rates, which they said caused the slowdown in business and investment activities.

According to a Bangladesh Bank rule that aims to prevent money-laundering, banks are now to submit details of transactions for cash deposit and withdrawal above Tk 7 lakh.

The finance adviser stressed the need for reducing the differentials between the interest rates for lending and deposit.

Terming the banks’ overall performance “not satisfactory”, he said the interest rate on lending is higher compared to that of deposits. “It indicates that we cannot perform banking activities efficiently,” he said.

The relatively high spread between the interest rates for deposit and lending has remained a matter of concern for Bangladesh Bank, which in its latest monetary policy announced to continue efforts to lower the interest against lending.

According to the central bank, the average difference between the two rates stood over 6 percent on September 30 last year; it was 5.93 percent on June 30.

Lack of efficiency and technology are the reasons of high operational cost, Mirza Aziz said.

He asked the state-owned banks to improve their competitive edge and increase lending to sectors that contribute to the country’s economic growth, reduce income disparity and help create jobs.

Echoing the view, Bangladesh Bank Governor Salehuddin Ahmed told senior officials of Agrani Bank that they “should focus on lending more to agriculture sector and small and medium enterprises for the greater benefit of poor people”.

He also advised them to focus on recovering the loans lying with top defaulters and improve monitoring system.