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Country's non-banking financial institutions (NBFIs) will be allowed to borrow from the inter-bank call money market maximum 40 per cent instead of 30 per cent of their equities.
The decision was taken at a meeting with the chief executive officers (CEOs) and managing directors (MDs) of NBFIs at the central bank headquarters in Dhaka on Tuesday with Bangladesh Bank (BB) Governor Fazle Kabir in the chair.
The BB's latest move came against the backdrop of liquidity pressure on the non-banking financial sector.
"We've decided to relax our policy to help ease liquidity pressure on the NBFIs," a senior BB official told the FE after the meeting.
Earlier on January 29 last year, the central bank set the call money borrowing limit based on equity instead of net asset for the NBFIs.
The equity will be ascertained on the basis of the balance-sheet on the last working day of each calendar year of the NBFI concerned.
Talking to the FE, Md Khalilur Rahman, chairman of Bangladesh Leasing and Finance Companies Association (BLFCA), said such policy relaxation will help ease liquidity pressure on the NBFIs to some extent.
At the meeting, the NBFIs also were advised to raise capital through issuing bonds that will also help reduce dependence on funds from banks.
"We've suggested that the NBFIs create an alternative source of fund through boosting bond market in Bangladesh," another senior central banker said while replying to a query.
He also said the central bank, Bangladesh Securities and Exchange Commission (BSEC) and the Ministry of Finance are working to develop the country's bond market.
"We're also interested to issue bonds for creating a new window for investment," Mr. Rahman, also managing director of National Housing Finance and Investments Limited, said while replying to a query.
Sources, however, said the BB governor would send a letter to the National Revenue Board (NBR) shortly requesting it to facilitate boosting the bond market through providing policy supports.
At the meeting, the CEOs were advised to improve their quality of assets and take necessary measures to reduce the amount of non-performing loans (NPLs) through expediting their recovers drives.
Currently, 34 NBFIs are running their business across the country.