Bangladesh’s cottage, micro, small and medium enterprises (CMSMEs), a priority sector of the government, cannot avail of the stimulus loan as fast as they had expected due to its slow disbursement process. Bangladesh Bank has set a loan disbursement target of Tk 20,000 crore in its second round to cottage, micro, small and medium enterprises (CMSMEs) by December next. Read:CMSMEs divisional Mentorship Program launched at DU But the disbursement target may be missed as only 2.82 percent loan was disbursed during the July-August period among 2390 firms of CMSMEs, according to the central bank statistics. “The disbursement of the remaining volume by December may not be possible as many of the CMSMEs finally cannot fulfil the conditions of banks to receive the loan,” said Syed Mahbubur Rahman, Managing Director and CEO of Mutual Trust Bank. He said extra efforts need to be taken on this front as the central bank’s CGS has no impact on loan disbursement yet as its conditions are too tough for small entrepreneurs to meet. “More than 90 percent of CSMEs in Bangladesh are informal which are not registered with any government authority and don’t maintain any financial records,” Mahbub said. As a result, he said, these CSMEs are highly unlikely to benefit from the newly implemented credit guarantee scheme (CGS) since commercial banks do not usually lend to informal businesses because of higher perceived risks.  

Dhaka Chamber of Commerce and Industry (DCCI) on Monday called on the government to formulate an SME act and redefine cottage, micro, small and medium enterprises (CMSMEs) in the upcoming Industrial Policy.