CMSMEs can now take term loan under stimulus package
Publish- February 01, 2021, 10:34 PM
UNB NEWS - UNB NEWS
Update- February 01, 2021, 11:05 PM
Cottage, micro, small and medium enterprise (CMSME) affected by Covid-19 will now be eligible to avail term loans under the collateral free credit guarantee scheme of Bangladesh Bank as part of the government-announced stimulus package.
According to a Bangladesh Bank circular, issued by the SME and Special Programme Department, the credit guarantee scheme will be similarly applicable for term loan as well beside existing facilities for working capital loan.
The circular said that many CSM investors do prefer to take term loans instead of working capital loans for their business ventures. Against this backdrop, the new facilities were introduced for the CSM sector, said the Bangladesh Bank.
Earlier on January 3, the Bangladesh Bank further extended the deadline until March 31 for the disbursement of loans under the government-announced stimulus package of Tk 20,000 crore for the Covid-19 affected CMSME sector.
In a recent observation by the central bank, it was found that most of the banks have failed to reach targets of loan distribution among the affected CMSME entrepreneurs within the stipulated time which promoted the central bank to further extend the time till December 31.
The central bank found that a good number of banks failed to distribute loans under the stimulus package though some banks were successful in achieving their targets.
A Bangladesh Bank study found that only 28.4 percent of the loans for CMSME sector were distributed until October 31 last year while banks have disbursed about 70.8 percent of loans meant for large-scale industries.
The latest Bangladesh Bank data show that from the Tk 20,000-crore package for CMSMEs, banks have disbursed Tk 5,674 crore while they have so far disbursed Tk 28,313 crore from the Tk 40,000-crore packages meant for large businesses and exporters.
Studies show that workers in the informal sector, especially in the CMSME, have been pushed into a difficult situation as many of them have lost their jobs and many more have faced a decline in income.