The scheduled banks and non-bank financial institutions continued to ignore the rural entrepreneurs disbursing only 23.86 per cent of their total sanctioned SME loans among them in the first half of this year. According to the latest Bangladesh Bank data, the banks and the NBFIs disbursed Tk 11,252.46 crore in loans to the SMEs located in the rural areas from January to June of 2014 under the BB’s small and medium enterprises credit programme. They distributed total Tk 47,160.92 crore under the programme in the period.
Experts and BB officials said that a number of banks and NBFIs were reluctant to disburse loans to the SMEs located in the rural areas as they were not bound by laws to give certain amount of such loans in the rural areas.
Due to the lower SME loan disbursement in the rural areas, the cluster-oriented SME industries were not getting adequate loans from the banks and the NBFIs resulting that the SME activities of the BB left very little impact on the country’s rural economic situation, they said.
The four state-owned commercial banks — Sonali, Janata, Agrani and Rupali — disbursed Tk 554.58 crore, or 19.29 per cent of their total distributed SME loans of Tk 2,874.83 crore in the period.
The BB data showed that the local private commercial banks disbursed Tk 10,142.76 crore, or 24.96 per cent of their total distributed SME loans of Tk 40,637.70 crore.
The foreign commercial banks disbursed only Tk 2.50 crore, or 0.57 per cent of their total distributed SME loans of Tk 438.49 crore.
In the first six months of this year, the 31 NBFIs disbursed SME loans of Tk 210.23 crore, or 13.24 per cent of their total distributed SME loans of Tk 1,587.65 crore.
The BB data, however, showed that the SME loan disbursement by the banks and the NBFIs in the first six months of this year increased by 12.62 per cent to Tk 47,130.38 crore from that of Tk 41,848.56 crore during the same period a year ago.
A BB official said the central bank did not specify the amount of SME loans to be disbursed by banks and NBFIs in the rural and urban areas.
‘So a number of FCBs and NBFIs have not disbursed any SME loans in the rural areas in the first six months of this year,’ he said.
Former BB governor Salehuddin Ahmed told New Age on Thursday that the central bank had no specific programme to create entrepreneurs in the rural areas.
‘A few of businesspeople of the country are getting the majority amount of credit from the banking sector by using their influence. The same persons, whose business activities in the urban areas are also receiving the SME loans resulting that the rural entrepreneurs are missing out the loans,’ he said.
The government should take initiative to activate the SME Foundation more so that it can play the role in creating entrepreneurs of the SME sector in the rural areas, the former BB governor said.
Bangladesh Institute of Development Studies research director Zaid Bakht said that the banks were reluctant to disburse SME loans in the rural areas considering the poor loan recovery as the potential enterprises were located in the urban areas.
A BB official said that the FCBs failed to disburse the SME loans in the rural areas as most of them have no branches in the rural areas.
‘If the FCBs desired, they could have disbursed SME loans through microfinance linkages in the rural areas,’ he said.
Besides, the FCBs and the PCBs do not have adequate manpower to operate the credit programme in the rural areas, he said.
Asked why the SCBs did not disburse adequate SME loans in the rural areas despite having a huge number of branches, the BB official said the SCBs were not allowed to get any loan under the refinance funds of the BB, Japan International Cooperation Agency and Asian Development Bank.
The SCBs failed to maintain quality as per the requirement of the refinance funds, he said.
He said, ‘The foreign donor agencies’ main objection is the high amount of classified loans held by the SCBs.’
-With New Age input
