Despite the central bank's priority, banks have failed to achieve the stimulus loans (phase-2) disbursement target among cottage, micro, small and medium entrepreneurs (CMSMEs). According to the latest report of BB, banks have disbursed Tk14,746 crore against the target of Tk 19,340 crore for FY22, which is 73.77 per cent of the target. In the previous fiscal year (FY21) banks disbursed the CMSMEs loans 77 per cent of the target. It means banks’ CMSMEs loans disbursement reduced by 4.15 per cent in FY 22 than the FY 21. Also read: BB asks banks to cut power use 25 pc, energy 20 pc in a year Banks distributed these loans among 82,190 entrepreneurs in the FY 22. Among them, there were 73,642 male entrepreneurs while 14,617 female. In June, the last month of the fiscal year (FY), Tk3323 crore of loans were distributed among 17,913 entrepreneurs. Of which, women entrepreneurs were 3,296 and male entrepreneurs were 14,617. In the second phase, state-owned banks disbursed loans of Tk2, 280 crore, which is 82 percent of the target. Read: BB asks banks to keep branches open in Dhaka cattle market areas on July 8,9 The loan disbursement by specialized banks is Tk 241 crore, which is 96 percent of the target. Foreign banks disbursed Tk72 crore, which is 38 percent of the target and Islamic banks disbursed Tk 3,636 crore, which is 64 percent of the target. Agrani Bank Limited has disbursed the highest loans among the state-owned banks. The bank had a target of Tk 890 crore. Against this, Agrani Bank has distributed Tk 1,113 crore, which is 125 per cent of the total target. Sonali Bank disbursed loans of Tk 537 crore against the target of Tk 500 crore, which is 107 per cent of the target. Read SME Foundation disburses Tk300 crore stimulus loans to 3,106 entrepreneurs Bangladesh Krishi Bank has disbursed loans 99 per cent against the target of Tk 200 crore. The bank has disbursed Tk198 crore. Foreign City Bank NA has achieved 100 per cent of the CMSMEs loan disbursement target. Besides, the private sector AB Bank has disbursed 105 per cent loans of the target. The target of the AB bank was Tk 240 crore and it disbursed Tk 253 crore. Read Bangladesh Bank's role in steering economic recovery appreciated Despite the effort of BB, banks failed to fulfill the CMSMEs stimulus loan disbursement target in two consecutive years. The CMSMEs borrowers alleged that banks harass the borrowers in the name of documents for lending.
Economists and business insiders said the stimulus loans for the big and small businesses have worked like oxygen to face a crisis during the pandemic period. Former BB governor Dr. Salehuddin Ahmed told UNB that the central bank has done a tremendous job, emphasizing implementation of stimulus loans. Despite some criticism of delayed disbursement, the BB’s contribution to economic recovery is appreciable, he said. Read:BB asks banks to cut tax on service value of non-resident nationals Md. Jashim Uddin, president of the Federation of Bangladesh Chamber of Commerce & Industry (FBCCI) and Faruque Hassan, president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) echoed similar sentiments. They also acknowledged that the support of BB has worked to increase the confidence of businesses which helped them rebound in the production of the industries. Latest update of stimulus loan disbursement shows that around Tk1.218 lakh crore (Tk1, 00,218 crore) has been disbursed so far in first and second phases from 10 incentive packages managed by Bangladesh Bank. Of this, Tk 42,173 crore was disbursed to the industry and services sector, Tk 20,793 crore in cottage, small and medium enterprises, Tk 513 crore in refinancing loans in the pre-shipment sector, and Tk 2,492 crore disbursed among low-income professional farmers and small traders. Besides, Tk 21,250 crore from the export development fund, Tk 1,933 crore from SME sector loan guarantee scheme, Tk 5,000 crore for workers in export-oriented industries, Tk 1,390 crore for consumer interest subsidy and Tk 4466 crore for agriculture sector refinancing scheme. has been distributed. However, a fund of Tk 1,000 crore was set up for the salaries and allowances of the employees of hotels, motels and theme parks in the tourism sector but no loan was disbursed. The BB started implementation of the second phase of 10 stimulus loan packages from July of current fiscal year 2021-22 through banks and FIs. The BB released an update of stimulus loan activities till January 11, recently. It said banks and financial institutions (FI) have disbursed Tk 15,000 crore among 67,000 entities in big and small categories across the country till January 11, 2022. According to the BB, in the first phase, Tk 32,703 crore was disbursed from the announced incentive fund of Tk 40,000 crore for the industry and services sector. Some 3,306 units have received this loan. In the second phase Tk 9,470 crore has been distributed from this fund to 972 businesses. Although the interest rate of this fund is 9 percent, the customers have to pay 4.5 percent while the government bears the rest. Besides, Tk 5,407 crore has been disbursed in the second phase under the announced stimulus package for cottage, small and medium enterprises. Around 35,760 enterprises have received loans from this fund of Tk 20,000 crore. In the first phase, a loan of Tk 15,386 crore was given from this fund to 97,814 enterprises. The interest rate on this loan is 9 percent, but here again the government is giving a 5 percent subsidy on the interest rate. Read: BB asks banks to follow Covid guidelines till Feb 21 In the agriculture sector Tk 379 crore has been disbursed to 30238 farmers/ clients from the agriculture refinance funds in the second phase. In the first phase Tk 4295 crore was distributed to 1.85 lakh farmers and agro based industries. The farmers and agro industries have received the loans at 4 percent interest rate and Bangladesh Bank has provided the refinance funds to the lender banks at 1.0 percent interest rate. Bangladesh Bank officials said that there was not as much interest to receive stimulus loans in the second phase. Demand for stimulus loans was higher among the businesses in the first phase. In fact, the time has now come for those who have taken loans to repay their loans, they told UNB. And this too is a sign of the recovery underway.
The SME Foundation has disbursed Tk300 crore of stimulus loans ahead of the government’s declared schedule time to offset the loss of Covid-19 pandemic. The loan was disbursed among 3,106 CMSME entrepreneurs at the marginal level on easy terms and at low interest, said the Foundation on Sunday. The stimulus loans have been given to cottage, micro, small and medium enterprises (CMSMEs) under the government's second phase incentive package to accelerate the country's economic recovery in the face of coronavirus to improve the living standards of marginalized people in rural areas. Also read: BB fixes 15pc installment for CMSME to avoid loans classifying In the second phase, it announced an incentive package of Tk 1,500 crore, of which Tk 300 crore was allocated in favour of the SME Foundation. In the fiscal year 2020-21, the finance department released Tk 100 crore in favor of SME Foundation and in the fiscal year 2021-22, the finance department released Tk 200 crore. Of this, the SME Foundation distributed Tk 200 crore, six months ahead of schedule for the current financial year. The SME Foundation has distributed the entire amount in just four and a half months in two phases. Around 26 per cent of the loans disbursed to women entrepreneurs and remained 74 per cent loans disbursed to men entrepreneurs. Among the loaned entrepreneurs, 1462 are from the trading sector, 1167 from the manufacturing sector and 477from the service sector. Around 50 per cent of entrepreneurs have received loans of less than Tk 5 lakh. Also read: We need to strengthen SMEs, agro-businesses for expanding economy: Tipu Munshi The SME Foundation has signed loan disbursement agreements with 12 banks and financial institutions in the first phase and 19 banks and financial institutions in the second phase. Banks and financial institutions are Brac Bank, Bank Asia, BASIC Bank, The City Bank, Mutual Trust Bank, Dhaka Bank, NRB Commercial Bank, Premier Bank, Social Islami Bank, One Bank, Prime Bank, Karmasangsthan Bank, United Commercial Bank, Eastern Bank, Southeast Bank, Rajshahi Krishi Unnayan Bank, Bengal Commercial Bank, IPDC Finance, IDLC Finance and Lankabangla Finance. Entrepreneurs have received loans at 4 per cent interest under the stimulus package. In the first phase, the amount of loan at the entrepreneurs’ level ranged from a minimum of Tk 1 lakh to a maximum of Tk 75 lakh. However, in the second phase, a maximum loan limit was set at Tk 50 lakh to bring more entrepreneurs under the loan scheme.