Business Desk :
The government’s target for the Covid-19 stimulus packages to Cottage, Micro, Small and Medium Enterprises (CMSMEs) in the second phase was set at Tk20 thousand crore, however only Tk13,505 crore worth of loans were disbursed in FY22, which is only 67.52% of the total target.
Disbursement of the Tk2,000 crore Credit Guarantee Scheme (CGS) under the CMSME package is merely 6% of the target, at only Tk121 crore.
According to insiders, the CMSME sector has been the most affected during the pandemic, and yet they are getting less credit as banks are more inclined to disburse loans to big borrowers.
In the case of small borrowers, they are often left discouraged as they face various complications while getting loans from the banks.
Data shows that, under the export development fund, only 2% interest incentive was announced for the big-scale traders to increase the scope to import raw materials under back-to-back letter of credits (LC) and almost 100% of the Tk29,750 crore, announced for this, was distributed.
Disbursement of the working capital stimulus loans for firms in the affected industrial service sector enterprises were targeted at Tk33,000 crore in the outgoing fiscal.
At the end of the fiscal year, only Tk12,588 crore had been distributed. A total of 1,311 industries have benefited from this scheme.
In the previous fiscal year (FY21), a loan package of Tk40 thousand crore was announced in this sector, and at that time the number of beneficiaries were 3,306 industries.
The pre-shipment credit refinance scheme has been announced to the tune of Tk5,000 crore. From this package, 70 institutions have received loans worth Tk725 crore, which is only 14.51% of the set target of Tk5000 crore.
Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue (CPD), said: “Banks need some confidence in disbursing loans. In that case, small entrepreneurs get much less loans due to various obligations to fulfill the formalities of small entrepreneurs. So generally the disbursement of small loans is always lower than the target because banks are reluctant to give loans to small entrepreneurs.”
He also said: “We always stress on taking special initiatives in disbursing loans to small entrepreneurs, because more jobs are linked with the small and medium ventures. Besides, it is also important for the economy.”
“Small-entrepreneurs do not get more loans due to a lot of paperwork involved,” Mustafizur Rahman pointed out.
“Some banks are offering loans based on transactions on the Bkash and Nagad platforms, and such innovative initiatives should be encouraged,” he added.
“For the ongoing fiscal year, Tk25000 crore stimulus package has been announced for the CMSME sector. I would say that the banks through which it will be disbursed should fulfill the target and they should be monitored quarterly,” he advised.
On the other hand, with two months in hand, 94% of the second phase loans of Tk3000 for the agriculture industry has been distributed.
