SME credit disbursement sees 9 pc growth in Q1 of current yr

The overall small and medium enterprise (SME) credit disbursement grew by nearly 9.0 per cent in the first quarter (Q1) of the current calendar year following strengthening of monitoring and supervision by the central bank.
All scheduled banks and non-banking financial institutions (NBFIs) disbursed Tk 210.53 billion in the January-March period of the current calendar year, compared to Tk 193.52 billion in the corresponding period of the previous year, according to the Bangladesh Bank (BB) statistics.
The loans were given to more than 130 SME sub-sectors such as light engineering, handicraft, flower, fish processing, handloom, rice-mill, jamdani, Rajshahi silk, khadi, bio-gas and compost fertiliser.
"The political turmoil has hampered the disbursement of SME loan slightly in the Q1," Masum Patwary, general manager of the SME and Special Programmes Department of the BB, told the FE Sunday.
The banks and the NBFIs have achieved nearly 24 per cent of their annual SME loan disbursement target for 2014, fixed at Tk 885.37 billion, the BB data showed.
"We expect that the disbursement of SME loan will rebound in the coming months as political situation improved in the country after holding of the parliamentary elections on January 5 last," the central banker noted.
He also said the BB is now working to cross the SME loan disbursement target again by the end of this calendar year.
In 2013, the banks and the NBFIs disbursed Tk 853.23 billion to 744,228 SME entrepreneurs across the country, which was 116 per cent higher than the target, fixed at Tk 741.87 billion. A total of Tk 697.53 billion SME loan was disbursed in 2012.
Talking to the FE, another BB official said the central bank has already introduced a three-tier monitoring system to ensure growth of the SME sector.
Under the monitoring system, the central bank headquarters, its ten branch offices across the country and head offices of all commercial banks will review the implementation of SME credit programmes regularly.
Besides, the BB has taken different measures including a new monitoring system using mobile phone to ensure proper utilisation of the SME loans across the country.
"We're now conducting inspection aiming to ensure utilisation of the SME loans at the field level," the central banker noted.