Access to fund for SMEs sought

Economists and academia put emphasis on ensuring access to funds for the Small and Medium Enterprises (SMEs) to help them absorb the economic shock of Covid-19.  

They also suggested reforming the old infrastructure of the SME Foundation and the government agencies should cooperate with the new entrepreneurs.

The speakers termed the 25 per cent contribution of the SMEs to the GDP as poor compared with the neighbouring countries.

The discussants made the call in a virtual dissemination programme titled ‘The Future of SMEs after the Corona Crisis: Challenges and Opportunities’ organised by the SME Foundation and Friedrich-Ebert-Stiftung (FES) on Tuesday.

Zakia Sultana, secretary, Ministry of Industries, addressed the programme as chief guest while the zoom meet was moderated by Md Mafizur Rahman, managing director of the SME Foundation.

Former Bangladesh Bank Governor Atiur Rahman said the SME-related policies including training, financing and global marketing should be reformed to help Covid-hit businesses particularly the small and medium ones.

The Bangladesh Bank should issue the instructions for banks and financial intuitions on loan disbursement so that the entrepreneurs can get easy access to loan facilities.

About 42 per cent SME employees got partial salary and four per cent did not get any salary when 66 per cent to 76 per cent products of the entrepreneurs remained unsold during the Covid-19 period, Atiur said.

In addition, he said that 68 per cent SME entrepreneurs would not be able to sustain if lockdown continued for four more months.

The SME Foundation should take the responsibility of making an authentic list of small and medium entrepreneurs who merit loan from the stimulus package, which aims at mitigating the economic fallout of Covid-19, the former BB governor said.

He suggested the SME Foundation should keep the credit guarantee scheme, transaction and other loan disbursement process under surveillance and to this end, if needed, the foundation should enhance its capacity.

Professor Masudur Rahman said the access to finance is the key to face the challenges in the SME sector as the entrepreneurs are mostly deprived of stimulus package facilities.

“We would make sure that the small, micro and medium entrepreneurs would get access to alternative financing processes,” he said.

Referring to the previous loan distribution process, he said that the banks and agencies have disbursed Tk 15,500 crore out of Tk 20,000 crore from the first stimulus package among 95,000 entrepreneurs. 

“It is high time we gave importance to the strengthening capability of the SME Foundation, recruiting more manpower and giving more logistic support. If we can enhance the capability of the foundation, we will be able to expand our reach that may leave positive impact on the role of the SMEs in the economy,” he added.