The decision is part of the government’s 2020-21 fiscal budget currently being reviewed by lawmakers, the parliamentary news website ICANA reported.
Accordingly, banks can directly lend to domestic investors or participate in funding projects. The lending can be both in rial and foreign currency.
Investors in private sector, cooperatives and non-government public entities can use the loans for various national projects, including the upstream gas and oil projects.
The funds could also be channeled to finance infrastructure and development projects in the industrial and mining sector as well as water and electricity projects with priority given to less privileged regions.
Banks and credit institutions gave 12,199.4 trillion rials ($48 billion) in loans to economic sectors in the first nine months of the current fiscal year (March 20-Dec. 20, 2020).
Compared with loans in the first three quarters of previous year, the figure increased by 5,936.7 trillion rials ($23.7 billion) or a whopping 94.8%, according to data released by the Central Bank of Iran.
As is the norm, loans disbursed to boost working capital of manufacturers accounted for the lion’s share with 7,214.7 trillion rials ($28.8 billion), including mines, industries, housing, agriculture and the services sector. Loans in this category accounted for 59.1% of the total.
Working capital credit to business increased by 3,806.4 trillion rials ($15.2 billion) or 111.7% on an annualized basis. Mines and industries were the main recipients at 2,704.4 trillion rials ($10.7 billion) or 37.5% of total working capital loans.