Credit Card Loan Limit Reaches 40 Lakh: New Policy by Bangladesh Bank

To encourage a cashless culture in the country's financial transactions, Bangladesh Bank has introduced major reforms in the credit card policy. Customers can now enjoy double the loan facilities than before. Along with the increased loan limits, strict rules regarding interest rates and consumer protection have also been implemented.

Let's take a look at the key highlights of this new policy:

1. Massive Increase in Loan Limits

Previously, the maximum loan limit against a credit card was 20 lakh BDT. According to the new circular, this limit has been increased to 40 lakh BDT.

  • Unsecured Loans: Loans without any guarantee or collateral can now be up to 20 lakh BDT (previously 10 lakh).
  • Secured Loans: Loans against bank deposits or FDRs can now go up to 40 lakh BDT (previously 25 lakh).

2. Rules on Interest Rates and Charges

Interest rates are often the biggest concern for credit card users. The new policy brings transparency to this area:

  • Maximum Interest: The maximum interest rate on credit card loans will be 25%.
  • Interest Calculation: Interest will be charged only on the outstanding or unpaid balance, not on the total bill amount.
  • Late Payment Fee: If a payment is delayed, banks can charge a late fee only once.
  • Change Notification: Any change in interest rates or other charges must be informed to the cardholder at least 30 days in advance.

3. Cash Withdrawal and Other Benefits

  • Cash Withdrawal: A maximum of 50% of the total credit card limit can be withdrawn in cash. While there is a grace period for purchases, interest will be applicable from the first day for cash withdrawals.
  • Card Activation: Banks cannot charge any fees before the card is officially activated or made functional.

4. Strictness on Consumer Protection and Harassment

There are often complaints of harassment against banks or recovery agents during debt collection. This has been strictly prohibited in the new policy:

  • Under no circumstances can a customer be subjected to mental or physical harassment or threats.
  • Communication for debt recovery must be limited to official working hours only.
  • The personal privacy of the cardholder's family, friends, or references must be maintained.
  • A 24-hour helpline must be active to block cards quickly if they are lost or stolen.

5. Eligibility for Getting a Card

  • The applicant must be at least 18 years old.
  • 16-year-olds can use supplementary cards if they are dependent on the primary cardholder.
  • The applicant must have an e-TIN certificate.
  • The Credit Information Bureau (CIB) report must be clean and satisfactory.

Why This Change?

Bangladesh Bank stated that the old policy from 2004 has been abolished to implement these new guidelines. The goal is to strengthen risk management for customers and build a transparent and modern digital payment ecosystem.

Are you thinking of getting a new credit card? or do you want to increase your current card limit? Feel free to ask any questions in the comments.