Bangladesh bank (BB) has set the target for disbursement of Small and Medium Enterprises (SMEs) loan at Tk 887.53 billion for the year 2014. The amount is 19.63 per cent higher than the last year’s target of Tk 741.87 billion. According to sources, the scheduled banks and financial institutions disbursed a total of Tk 853.23 billion in last year (2013) among 0.744 million SME entrepreneurs across the country.  The SME loan disbursed in 2013 was also16 per cent higher than the target set for the year. Out of the total disbursements, women entrepreneurs received Tk 33.46 billion under the SME financing. Of the amount Tk 654.72 billion crore was distributed in urban area while Tk 198.50 billion in rural area. The authorities could achieve their target in disbursement of SME loans because of due policy supports from the central bank like rescheduling facilities and low interest rates, said SME Programme Department general manager Masum Patwary.
“BB always encourages commercial banks and the financial institutions to supply adequate loan to SME entrepreneurs to promote the Small and Medium  scale industries,” said the general manager. BB  is  planning to implement some effective initiatives for further expansion of SMEs across the country such as start up financing, credit guarantee scheme, venture capital financing, SME deposit product, cluster mapping, SME product marketing and web based marketing, non financial services and  incubation centre.
In Bangladesh, 90 per cent private sector enterprises are SMEs. Around 25 per cent of the country’s total labour force are working in the SME sector and contributes about 40per cent of gross manufacturing output, the general manager also added.
Banks in Bangladesh are being supported in SME financing initiatives at subsidised interest rate with refinance facilities from Bangladesh Bank, which is being funded by the central bank, government of Bangladesh and development partners like IDA, ADB and JICA.
The SME loan disbursement has increased in recent days as the central bank is continuously encouraging new entrepreneurs to take SME loans from banks and financial institutions, said M Mafuzur Rahman, executive director of the central bank.
“The development of SMEs can reduce economic disparity from society and help the country to create more employment opportunity. So we need to expand SME loan allocation across the country for the betterment of the economy,” also said the executive director.

News:Daily Sun/08-Feb-2014