• In-form Sangakkara thwarts Bangladesh again
  • State-sponsored terrorism spread across country: BNP
  • 14 dead as bus falls into ravine in Philippines
  • No militant backer in 10th parliament: Inu
  • PM opens Light & Sound Show at Lalbagh Fort to attract visitors
HOME  MAIN NEWS
  
Print Friendly and PDF

2013 SME LOANS

65 per cent goes to unproductive sector

KM Zamir Uddin

SME loan disbursement by the banks and non-bank financial institutions increased by 22.32 per cent in 2013 from that of 2012 although major amount of the loans went to trade or unproductive sectors bypassing the manufacturing zone, according to BB data released on Thursday.
Experts said that the major financial goal of small and medium enterprises could not be fulfilled due to the higher loan disbursement trend in the trading sector than the manufacturing sector.
The higher loan disbursement in the trading sector usually put a lower impact on the country’s overall economy as such type of investments fail to cerate employment generation.
The BB data showed that all banks and NBFIs had disbursed a total of Tk 85,323.25 crore in SME loans in 2013 against Tk 69,753.32 crore in 2012.
The SME loan disbursement by banks and the NBFIs had increased by 28.22 per cent to Tk 56,703.72 crore in the trading sector in 2013 against Tk 44,222.65 crore in 2012.
The trading sector got 66.65 per cent of the total SME loan disbursement in 2013 while it got 63.40 per cent in 2012.
The higher loan disbursement ratio indicated that the banks were more interested in the trading sector, a BB official told New Age. 
The banks and the NBFIs disbursed Tk 24,016.64 crore and Tk 4,602.89 crore in manufacturing and service sector respectively in 2013 against Tk 21,896.33 crore and Tk 3,634.34 crore in 2012.
The manufacturing sector got 28.15 per cent of the total SME loan disbursement in 2013 although the sector got 31.39 per cent in 2012.
The BB official said that the SME loan disbursement had increased significantly in the concluded year but it created little impact on the country’s industrialisation process.
Centre for Policy Dialogue executive director Mustafizur Rahman told New Age that the BB should take initiative to increase the loan disbursement in the manufacturing sector as such type of investment would play a significant role in creating employment generation.
The banks and the NBFIs usually disburse loan in the trading sector due to lower risk and secure their profit, he said.
The BB should open a dedicated window to monitor the manufacturing sector so that the business people would be encouraged in investing more in the sector, he said.
Former BB governor Salehuddin Ahmed said that the higher loan disbursement in the trading sector would not create a sustainable financial development as it hindered the industrialisation process.
Although higher loan disbursement in the trading sector will impact the economic growth, it will fail to create expected output, he said.
The central bank should convince the banks and the NBFIs so that they disburse more loans in the manufacturing sector than the trading sector.
Syed Mahbubur Rahman, managing director of BRAC Bank, which is one of the largest SME loan providing banks, however, said that the trading sector also played a major role in the economy as the country’s largest manufacturers had initially started their business with trading.
Trading also plays an important role in expanding the manufacturing sector, he said.
The major portion of SME loan went to trading sector as number of traders in the country is higher than the manufacturers, he said.




Reader’s Comment

comments powered by Disqus
   

ACC drops 3,000 graft cases

The Anti-Corruption Commission has dropped 3,053 graft cases in the last two years whilst proceeding with only 521 cases, ACC statistics show. Many of the cases dropped involve Awami League leaders or people... Full story

65 per cent goes to unproductive sector

SME loan disbursement by the banks and non-bank financial institutions increased by 22.32 per cent in 2013 from that of 2012 although major amount of the loans went to trade or unproductive sectors bypassing the manufacturing... Full story

BCL men spotted by media not arrested yet

The ruling Awami League-backed Chhatra League leaders that the media photographed firing into general students during attacks in Rajshahi University on February 2 were yet to be arrested. This is not the first incident in which... Full story

Formal charge against Jamaat likely in March

The war crimes prosecution expects it would be able to submit formal charges to the International Crimes Tribunal, better known as war crimes tribunal, by March on the role of the Jamaat-e-Islami in committing crimes against humanity... Full story

Hasina spends Tk 10 lakh in electioneering

The prime minister, Sheikh Hasina, spent around Tk 10 lakh for electioneering in her two constituencies—Rangpur 6 and Gopalganj 3—in the January 5 parliamentary polls. A three-member delegation of Awami League on behalf of Sheikh... Full story

BNP tired of counting leaders being killed: Rizvi

The BNP on Thursday alleged that the government had turned the country into a death valley saying that the BNP was feeling tired of counting deaths of its leaders every day. ‘The government has turned the... Full story

HC receives death reference for confirmation

The High Court registrar on Thursday received the death references former ministers Matiur Rahman Nizami and Lutfozzaman Babar, 11 civil-military bureaucrats and Indian separatist leader Paresh Baruah from a Chittagong court... Full story

Businessman’s hands cut off

Criminals on Thursday severed both the hands of a local businessman who had protested at their criminal activities in Narsingdi, said the police. The victim was Imran Molla, of Darichar village under Polash upazila in the district. Full story

PT-6 aircraft crash lands in Jessore

The pilots come out of a training aircraft that made an emergency landing in village Majdia close to Jessore airport on 
Thursday. — Focusbangla photo
Two pilots of Bangladesh Air Force escaped unhurt after a Chinese-made basic trainer aircraft had a forced landing at Maidi village in the district headquarters because of a technical glitch on Thursday morning, the officials said. Full story

India warns US of consequences on visa reform

India has warned the United States of consequences for its companies if lawmakers tighten visa rules on high-tech firms as part of an immigration overhaul. Ambassador Subrahmanyam Jaishankar said that India... Full story
  • Online Poll


    Do you think that the government has successfully brought back normalcy in public life after the January 5 elections?

    • Yes
    • No
    • No comment
    Ajax Loader