Business Report :
Bangladesh Bank (BB) has instructed all banks to recover at least 1% of their respective non-performing loans (NPLs) through alternative dispute resolution (ADR) mechanism by June 30, 2026.
It will also strengthen its monitoring in this regard from its highest level, according to a circular issued on Sunday.
The central bank pointed out that the relevant law has given more importance to the ADR mechanism for quick recovery of the default loans and settlement of disputes outside the court.
According to the law, before the court delivers its verdict or order at any stage of the case, both the parties can settle the case through the ADR mechanism with the permission of the court.
Subject to the consent of both the banker and the customer, it suggests selecting skilled and experienced mediators registered with similar institutions, including BIAC or retired judges, retired officers of banks or financial institutions, lawyers, or any other qualified person with a track record of success as mediator.