Syed Rezwanul Kabir, Managing Director of SMEF, and MIDAS Managing Director Shafiqul Azam, seen signing a loan agreement at SME Foundation office in Dhaka.

SME Foundation has pumped more funds for single-digit financing to small entrepreneurs under its credit wholesaling programme.

Serving the potential SMEs outside the coverage of conventional banking, especially the women, with collateral-free loan at single-digit interest rate is the main focus of the programme, officials said.

The Foundation on Thursday signed a deal with a non-banking financial institution – MIDAS, through which Tk 50 million will be disbursed to potential entrepreneurs.

SMEF managing director Syed Rezwanul Kabir and MIDAS managing director Shafiqul Azam signed the loan agreement on behalf of their respective sides.

Under the agreement, MIDAS will provide SME entrepreneurs with credits at only 9 percent rate, while it gets the money from the SMEF only at four percent rate, officials added.

Earlier, MIDAS received a total of Tk 20 million from SMEF, which was disbursed among 60 beneficiaries in light engineering cluster of Bogra.

Two commercial banks and MIDAS have so far disbursed such loans totaling Tk 67.5 million. The number of total beneficiaries was 161.

“Financing support from conventional banking is not enough for intended growth of SME sector,” Industries Minister Dilip Barua, the chief guest of the event, said.

“SME Foundation is playing a very significant role in providing financing to such risky investments,” the Minister, also the Chairman of SMEF, added.

“We want to put more emphasis on entrepreneurship and discourage trading,” he commented.

“So, we’re trying to identify new SME clusters across the country to support them with single-digit lending,” he added.

Speaking on the occasion, MIDAS chairperson Rokia A Rahman said the loan will be disbursed in agro clusters in Jessore and light engineering clusters of Bogra.

The Daily Sun/ Bangladesh/ 19th May 2012