B Mirror Report: Bangladesh Bank has revised its consumer financing policy, increasing auto and personal loan ceilings to meet growing demand and promote environmentally friendly vehicles in the country.

In a circular issued on Tuesday, the central bank said scheduled banks will now be allowed to provide auto loans of up to Tk 8.0 million for purchasing electric and hybrid vehicles. Previously, the ceiling stood at Tk 6.0 million for conventional cars.

The central bank also relaxed equity requirements for green vehicles and raised personal loan limits in response to rising consumer prices and demand.

It said the use of electric and hybrid vehicles is gradually increasing due to their energy efficiency and environmental benefits.

Under the new guidelines, the debt-to-equity ratio for auto loans has been set at 60:40. For hybrid and electric vehicles, however, the ratio has been eased to 80:20 from the earlier 70:30.

Bangladesh Bank noted that rapid growth in per capita income and overall economic expansion has significantly boosted the consumer goods market in recent years.

“Considering the prevailing market prices and rising demand for consumer goods, Regulation-30 of the Prudential Regulations for Consumer Financing has been revised,” the central bank stated.

As per the updated rules, unsecured personal loan limits have been doubled to Tk 1.0 million from Tk 0.50 million, while secured personal loans have been raised to Tk 4.0 million from Tk 2.0 million.

The central bank also instructed banks to ensure that the growth rate of total consumer financing does not exceed the overall loan growth rate of the respective bank.