Bangladesh Bank has set the SME loan disbursement target at Tk 1,33,853.59 crore for 2017, which is 17.93 per cent higher than the target set for the previous year.
A BB official told New Age on Sunday that banks were now showing an increased interest in disbursing small and medium enterprise loans as the businesspeople were reluctant to set up large-scale industrial units amid a dull business situation in the country.
According to the latest BB data, the target of SME loan disbursement by state-owned commercial banks increased to Tk 15,508 crore for 2017 from Tk 13,434 crore for 2016, that by specialised banks to Tk 1,030 crore from Tk 816 crore, that by private commercial banks to Tk 52,887 crore from Tk 44,564 crore, that by Islamic banks to Tk 55,947 crore from Tk 47,215 crore, and that by non-bank financial institutions to Tk 7,172 crore from Tk 5,457 crore.
The foreign commercial banks, however, cut their SME loan disbursement target to Tk 1,306 crore for 2017 from Tk 2,015 crore for 2016.
SME loan disbursement by banks has continued rising in recent years as the majority of banks have been focusing on the sector as a low-risk business zone.
The BB had set the annual SME loan disbursement target at Tk 1,13,503.43 crore for 2016, Tk 1,03,591 crore for 2015, Tk 89,030.94 crore for 2014, Tk 74,187 crore for 2013 and Tk 59,012.78 crore for 2012.
In 2016, SME loan disbursement by banks and NBFIs increased by 22.49 per cent to Tk 1,41,935.38 crore compared with that a year before.
The BB data, however, showed that 63.79 per cent of the total disbursed loans in the SME sector went to trade or unproductive sectors in last year.
The BB official said that the key goal of supporting the SMEs could not be achieved due to the higher loan disbursement to the trade sector.
Higher loan disbursement to the trade sector usually puts a negative impact on the country’s overall economy as such trend fails to expand the industrial sector and makes a little contribution to employment generation, he said.
The BB data showed that banks and NBFIs set a loan disbursement target of Tk 71,694.62 crore for 2017 in the trade sector, which is 53.57 per cent of the total SME credit disbursement target.
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