After taking over the Concessional Credit Line of Economic Stimulus Plan, BDBL has disbursed over Nu 198 million
YK Poudel
The Bhutan Development Bank Limited (BDBL) has disbursed Nu 198.36 million to applicants under the Economic Stimulus Plan (ESP).
Of the 1,473 applications received under Window I, which includes submissions from other financial institutions, 262 projects have been approved, amounting to a total of Nu 398.22 million. However, 126 applications have been declined.
This update was shared by the Finance Minister Lekey Dorji during the Meet-the-Press session yesterday.
Launched on May 18, 2023, the Nu 15 billion ESP is a government initiative to drive post-pandemic economic recovery.
The ESP is structured around two key funding windows. Window I or Concessional Credit Line primarily focuses on concessional loans for agriculture, livestock, and small to medium-scale industries, while Window II, the Reinvigoration Fund, supports broader economic revitalisation through the financial institutions.
As of December 3, 2024, Window II has received 87 applications from seven financial institutions. Thirteen of these have been approved, six declined, and 66 are under review. Subsidies amounting to Nu 87.73 million have been provided through this window.
Lyonpo Lekey Dorji said that the government made changes to expedite the disbursement of the ESP concessional loans. “The entire Nu 3.3 billion concessional loan is now being implemented through the Bhutan Development Bank Limited.”
The reinvigoration fund is implemented by all participating financial institutions.
“A dedicated unit is being established at BDBL for the assessment, disbursement, and monitoring of loans,” Lyonpo said.
Tandy Wangchuk, the president of the Bhutan Chamber of Commerce and Industry (BCCI), during the quarterly ‘Private Sector Press Conference’ yesterday, stated that while the ESP windows are open until December 31, BCCI would propose an extension of the application deadline to the government should funds remain available.
“Since BDBL has taken up the role of disbursing the concessional loans, the disbursement process has been streamlined to a single financial institution, with BDBL having branch offices across all 20 dzongkhags,” he said.
However, Gyam Dhendup, the president of the Bhutan Concrete Bricks Association, expressed concerns about the persistent challenges faced by the private sector, particularly due to lengthy requirements and processes.
“An individual has to invest over Nu 300,000 and take over a month to complete the requirements set by the financial institutions, yet, the certainty of approval is not guaranteed,” he said.
Earlier, he said, a principal approval system used to guarantee the possibility of receiving loans, but this new system for ESP does not offer such certainty.
“For the ESP loan, which is only for a three-year period, we appeal to the government to simplify the application process so that interested individuals can apply within the given timeframe,” he said.