Banks can disburse 70% of target to CMS

Banks can disburse 70 per cent to the cottage, micro and small (CMS) industries sector of its total target from the Tk 20,000 crore stimulus fund for the cottage, micro, small and medium enterprise (CMSME).

The Bangladesh Bank on Thursday issued a notice saying that the rest 30 per cent will have to be disbursed to the medium industries sector.

Of the 70 per cent for CMS sector, banks will have to disburse 65 per cent in the manufacturing and service sub-sector and the rest to the trading sub-sector, the notice said.

Of the total Tk 20,000 crore stimulus fund for the CMSME sector, eight per cent will have to be disbursed among women entrepreneurs.

In line with the government’s announcement, BB issued guidelines on April 13 last year on providing working capital facilities amounting to Tk 20,000 crore to the CMSME sector affected by the coronavirus pandemic, setting the interest rate ceiling at 9 per cent.

Of the interest, the government will bear 5 per cent as subsidy and the remaining 4 per cent will be borne by borrowers.

Till June this year, the banks disbursed 77 per cent from the fund. Then, the BB introduced a similar amount of fund for the current fiscal year. The disbursement deadline is June 30, 2022.