, Nov. 13 -- The Bangladesh Bank (BB) has relaxed the eligibility criteria for commercial banks and financial institutions to participate in Tk 25,000 crore refinance schemes for the Cottage, Micro, Small, and Medium Enterprise (CMSME) sector.

The move is a direct response to the banking sector's escalating rate of non-performing loans (NPLs).

The new directive issued by the SME and Special Programs Department said that banks and financial institutions can now access the fund even if their total classified (defaulted) loans reach up to 20 percent of their portfolio.

This is a significant change from the previous condition, which required institutions to maintain a classified loan ratio of less than 10 percent to be eligible for the sch...