BSS, Dhaka :
The banking sector has strongly been advised again to increase their credit flow to support small and medium enterprises (SMEs) and women entrepreneurs, which have long been seen vital to economic growth.
Inaugurating a workshop on “The Role of the Policy Makers and Central Banks in Promoting SMEs’ Access to Finance – The Case of Bangladesh” in the capital city, Bangladesh Bank (BB) Governor Dr Atiur Rahman said banks should be more enthusiastic in promoting SMEs and women entrepreneurship.
Bangladesh Institute of Bank Management (BIBM) in association with European Union (EU) and Bangladesh Inspired project of Ministry of Industries organised the workshop at BIBM. BIBM director general Dr Taufiq Ahmed Chowdhury chaired the inaugural session.
“We (bankers) offer lot of things to bigger entrepreneurs. Let’s do some thing for small ones”, the governor said.
He suggested providing SMEs and women entrepreneurs both financial and advisory assistance to ensure better use of loan and its timely recovery.
Dr Rahman said the present government has rightly identified SMEs as the priority sector for transforming Bangladesh into a middle-income country by 2021.
In line with government’s thrust, he said BB has been instrumental in designing and implementing SME sector development initiatives as part of its development financing agenda, with broadening financial access to cottage, micro and small enterprises and in particular women entrepreneurs.
He said BB has already become the role model in SME financing in the international arena within a span of only five years. Its initiatives are being studied by other central banks of the world.
The governor said a number of soft credit schemes are available through BB for financial institutions for lending to SMEs at a capped interest rate.
For women entrepreneurs, he said policy intervention including earmarking of 15 percent low cost fund for women entrepreneurs, clean lending limits up to 25 lakh, priority in loan processing, engagement of women business chambers and associations in client sourcing, mentoring and capacity building support are being encouraged.
The governor, however, said that there is still a long way to go before financial inclusion can be characterized as fully satisfactory.
“In many cases, SME lending by banks is not profitable due to the lack of appropriate processes and low technological level. If the lending is not profitable, the banks will not proactively increase portfolio in the micro and small and medium entrepreneurs (MSME) segment”, Dr Rahman said.
The governor suggested that banks should revisit their MSME banking model to identify pitfalls and undertake business process reengineering to make MSME banking profitable, less risky, and more consumers’ friendly.
The banking sector has strongly been advised again to increase their credit flow to support small and medium enterprises (SMEs) and women entrepreneurs, which have long been seen vital to economic growth.
Inaugurating a workshop on “The Role of the Policy Makers and Central Banks in Promoting SMEs’ Access to Finance – The Case of Bangladesh” in the capital city, Bangladesh Bank (BB) Governor Dr Atiur Rahman said banks should be more enthusiastic in promoting SMEs and women entrepreneurship.
Bangladesh Institute of Bank Management (BIBM) in association with European Union (EU) and Bangladesh Inspired project of Ministry of Industries organised the workshop at BIBM. BIBM director general Dr Taufiq Ahmed Chowdhury chaired the inaugural session.
“We (bankers) offer lot of things to bigger entrepreneurs. Let’s do some thing for small ones”, the governor said.
He suggested providing SMEs and women entrepreneurs both financial and advisory assistance to ensure better use of loan and its timely recovery.
Dr Rahman said the present government has rightly identified SMEs as the priority sector for transforming Bangladesh into a middle-income country by 2021.
In line with government’s thrust, he said BB has been instrumental in designing and implementing SME sector development initiatives as part of its development financing agenda, with broadening financial access to cottage, micro and small enterprises and in particular women entrepreneurs.
He said BB has already become the role model in SME financing in the international arena within a span of only five years. Its initiatives are being studied by other central banks of the world.
The governor said a number of soft credit schemes are available through BB for financial institutions for lending to SMEs at a capped interest rate.
For women entrepreneurs, he said policy intervention including earmarking of 15 percent low cost fund for women entrepreneurs, clean lending limits up to 25 lakh, priority in loan processing, engagement of women business chambers and associations in client sourcing, mentoring and capacity building support are being encouraged.
The governor, however, said that there is still a long way to go before financial inclusion can be characterized as fully satisfactory.
“In many cases, SME lending by banks is not profitable due to the lack of appropriate processes and low technological level. If the lending is not profitable, the banks will not proactively increase portfolio in the micro and small and medium entrepreneurs (MSME) segment”, Dr Rahman said.
The governor suggested that banks should revisit their MSME banking model to identify pitfalls and undertake business process reengineering to make MSME banking profitable, less risky, and more consumers’ friendly.
