Financial experts and banking professionals are calling on Bangladesh Bank to step back from micromanaging commercial banking operations and instead prioritize building a stable, resilient financial environment for the country. Concerns are mounting that excessive intervention in operational matters—such as setting strict lending conditions, imposing credit flow restrictions, and directly influencing interest rates—is stifling innovation and slowing down the natural growth of the banking sector. Analysts believe that the central bank’s primary role should be to ensure monetary stability, manage inflation effectively, safeguard foreign reserves, and maintain overall financial discipline, leaving day-to-day decision-making to commercial banks. They argue that a hands-off approach would encourage competition, improve customer service, and allow banks to respond to market needs more efficiently. Recent regulatory moves have sparked debate, with critics saying that frequent directives on loan disbursement and interest management disrupt normal banking operations, create uncertainty among investors, and limit access to financing for businesses of all sizes. Experts warn that when banks lose operational flexibility, it becomes harder to support entrepreneurs, finance large-scale projects, or provide timely credit to industries that drive economic growth. Instead of micromanagement, they recommend that the central bank focus on strengthening supervision frameworks, promoting risk-based decision-making, and improving governance standards across the sector. Financial analysts also point out that international best practices favor giving commercial banks the independence to make market-driven decisions under clear regulatory guidelines, reducing bottlenecks and fostering a healthier business environment. Many believe that if Bangladesh Bank adopts this approach, it will boost investor confidence, attract foreign capital, and help the country’s financial system mature in line with global standards. A balanced policy framework, they say, is crucial to allow innovation in financial services, particularly as digital banking and fintech solutions gain popularity. Stakeholders emphasize that effective central banking is about setting broad policies to ensure stability, not dictating operational details that private institutions are better equipped to manage. By shifting its focus towards long-term stability and systemic risk management, the central bank can create conditions where both banks and borrowers thrive, fueling sustainable growth for the entire economy while keeping the financial sector strong, transparent, and resilient.
