Thursday, 26 November, 2020, 3:38 PM
latest COVID-19: 37 more deaths, 2,292 cases reported in country      
Home Business

Bangladesh Bank raises loan disbursement limit of CMSMEs to 30 per cent

Published : Friday, 30 October, 2020 at 12:00 AM  Count : 72
Business Correspondent

Bangladesh Bank (BB) has increased the annual loan disbursement limit by banks and financial institutions to cottage, micro, small and medium enterprises (CMSMEs) sub-sector by 10 percentage points to 30 per cent from 20 per cent now aiming to support their speedy business recovery.
In this regard the central bank's SME and Special Programs Division of the central bank issued a circular on Wednesday. It said despite providing various facilities, loan disbursement from Tk200 billion incentive fund for CMSMEs is not increasing.
So the central bank has increased the loan limit to 30 percent to speed up the utilization of the fund to better serve its purpose. The BB says the central bank on April 13 announced the various incentive packages.
It said that due to large manpower employed in production and services of CMSME businesses, the business sub-sector in the micro and small scale industries was also included in the incentive package. At the same time, the ratio of annual loan disbursement in manufacturing, services and business sub-sectors was fixed at 50, 30 and 20 per cent respectively.
Subsequently, on 31st August, through another circular, the ratio of annual loans in manufacturing and services was restructured to overall 80 per cent instead of 50 and 30 per cent respectively.
The circular said although significant loans were disbursed to the industry and services sub-sectors of the coronavirus-affected CMSME sector, the progress in implementation of the package was not as expected. Moreover, field entrepreneurs and various business organizations engaged in the business sub-sector have requested for an increase in allocation in the business sub-sector.
In view of this, the ratio of annual loans of banks and financial institutions in the CMSME business sub-sector has been fixed at 30 per cent instead of 20 per cent.
However, if the annual loan disbursement by banks and financial institutions in CMSME sub-sector  exceeds 20 per cent (which cannot be more than 30 per cent in any way), the proportion of loans in the manufacturing and services sub-sectors will decrease at a proportional rate.
However, the overall debt ratio in the manufacturing and services sub-sectors will not be less than 70 percent. According to Bangladesh Bank sources, banks and financial institutions have disbursed only Tk48.22 billion to CMSME sub-sector under this package till last September.
A total numbers of 26,864 CMSMEs have received this loan. Of these, 1,124 are women entrepreneurs and 21,642 are men, the central bank circular said.






« PreviousNext »



Latest News
Most Read News
Editor : Iqbal Sobhan Chowdhury
Published by the Editor on behalf of the Observer Ltd. from Globe Printers, 24/A, New Eskaton Road, Ramna, Dhaka.
Editorial, News and Commercial Offices : Aziz Bhaban (2nd floor), 93, Motijheel C/A, Dhaka-1000. Phone: PABX 9586651-58; Online: 9513959; Advertisement: 9513663
E-mail: [email protected], [email protected], [email protected], [email protected],   [ABOUT US]     [CONTACT US]   [AD RATE]   Developed & Maintenance by i2soft