FBCCI urges banks to be committed to financing SMEs

Terming the small and medium enterprises (SMEs) as the backbone of the economy, Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) President Md Jashim Uddin on Sunday urged the banks to become more sincere to finance the SMEs.

He said the banks are reluctant to finance the SMEs as they feel comfortable with large companies, according to a press release.

Terming access to finance as the biggest challenge for SMEs, the country’s apex trade body chief said the prime minister’s loan incentive package for the large industries had been disbursed in three months while incentives for SMEs had not been disbursed in two years.

Jashim Uddin was addressing a seminar titled “Bangabandhu’s thought on SME development and present perspective” organised by the FBCCI in Dhaka.

ALSO READ - BB revises cluster credit guidelines to boost small enterprises

FBCCI Senior Vice-President Mostofa Azad Chowdhury Babu suggested establishing an SME bank to facilitate access to finance of the small and medium entrepreneurs.

He also suggested setting up BSCIC industrial villages at upazila level and allotting plots for SMEs in the economic zones.

While delivering the keynote presentation at the seminar, FBCCI’s panel advisor and CPD (Centre for Policy Dialogue) Research Director Dr Khondaker Golam Moazzem said the commercial banks provide only 18 per cent of their total disbursed loans to the SME sector. Only 9 per cent of SMEs have access to bank finance while the rest 91 per cent are deprived of banks' loan assistance.

Moreover, the proportion of SME loans has declined in recent years, which puts the development sustainability at risk, he said.

Speaking as the chief guest, Industries Minister Nurul Majid Mahmud Humayun expressed his dissatisfaction regarding bank financing to SMEs.

Mentioning that everyone speaks of SME but nobody cordially works, he stressed on strengthening the SME Foundation by financing.

At the event, SME Foundation Chairperson Md Masudur Rahman said that small and medium industries do not enjoy the same policy support as the large industries do.