SME lending grows, so does access to credit
Recipients of the Trust Award pose with Atiur Rahman, governor of Bangladesh Bank, and Syed Mahbubur Rahman, MD of BRAC Bank, at an SME conference at Shaheed Suhrawardy Indoor Stadium in Mirpur yesterday. Photo: BRAC Bank
Banks and non-bank financial institutions disbursed Tk 69,753 crore in SME loans in 2012, up 29.84 percent from a year ago.
As many as 4.63 lakh small and medium enterprises received the loans in 2012, according to data from Bangladesh Bank.
Buoyed by the success in taking money to the cash-strapped SMEs, the central bank has set the loan disbursement target higher at Tk 72,203 crore for 2013.
"Access to finance for SME entrepreneurs has improved a lot over the years. Even entrepreneurs from remote parts of the country get easy access to credit," Bangladesh Bank Governor Atiur Rahman said at the BRAC Bank SME Entrepreneurs Conference at Shaheed Suhrawardy National Indoor Stadium in Mirpur.
Countries such as Bangladesh with a huge population need labour-intensive industries like SMEs that create larger employment opportunities, Rahman said. It is the SMEs that keep the economy vibrant.
"Bangladesh must maximise the benefits derived from the SME sector, as it plays a pivotal role in promoting and sustaining the industrial as well as overall economic growth," he said.
“The role of SMEs in providing productive employment and income earning opportunities has emerged as an important concern among policy makers, donor agencies and other countries.”
The governor spoke at the BRAC Bank SME Entrepreneurs Conference at Shaheed Suhrawardy National Indoor Stadium at Mirpur in Dhaka.
BRAC Bank, a SME-focused bank, organised the event on the occasion of its 12th anniversary. The governor also urged the commercial banks to further increase credit flow to the SMEs.
In Bangladesh, 90 percent of private enterprises are SMEs and 70-80 percent of non-agricultural workforce works in the SME sector.
SMEs accounted for up to 25 percent of the gross domestic product last year and about 40 percent of gross manufacturing output and around 25 percent of the total labour force, the central banker said.
Syed Mahbubur Rahman, managing director of BRAC Bank, said: “The voices of SME entrepreneurs are not usually heard. We feel that their voices should be heard."
“We believe the conference will inspire the entrepreneurs to break new grounds and bring new dynamism to the sector.”
More than 2,000 entrepreneurs from across the country joined the conference designed to infuse dynamism into the SME sector.
At the conference, the entrepreneurs shared their problems and prospects with policymakers and bankers.
Recommendations based on the field-level experiences of the entrepreneurs will be forwarded to Bangladesh Bank, the SME Foundation and the government.
At the conference, one entrepreneur from every division was honoured with the Trust Award. At total of 13 awards were given in categories such as Woman Entrepreneur Award and Creative Entrepreneur Award.
Atiur Rahman presented the awards to the recipients. Shykh Seraj, a media personality, also spoke.
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