Business leaders on Wednesday requested the country’s banks to disburse speedily loans under the government announced stimulus packages for industries.
Bankers, however, sought a credit guarantee scheme for loans to be disbursed, particularly for the credit to be given to cottage, micro, small and medium enterprises (CMSMEs).
Both sides made the demands at an online meeting organised by the Federation of Bangladesh Chambers of Commerce and Industry on a roadmap regarding the disbursement of loans worth Tk 30,000 crore and Tk 20,000 crore under the stimulus packages announced by the government to offset the coronavirus outbreak fallout.
FBCCI president Sheikh Fazle Fahim said that the Association of Banks, Bangladesh should play a proactive role in implementing the stimulus packages so that entrepreneurs, particularly traders from SMEs, women, shop keepers, media houses and other distressed sectors could get loans speedily and on time.
A delay in loan disbursement will result in a loss of relevance and efficacy, he said while moderating the meeting from the FBCCI conference room in the capital.
The government should appoint Special Monitoring Unit of the Bangladesh Bank for monitoring the effective implementation of the stimulus.
He said that the government could offer credit guarantee or risk sharing scheme for banks and financial institutions to minimise risk in loan recovery and ensure adequate loan facility for SMEs.
The FBCCI also requested banks to offer moratorium facility on existing loans and interests for next three quarters starting from April 1, he said.
ABB president Ali Reza Iftekhar said that there would be no liquidity crisis due to policy measures announced by the central bank.
But there are risks regarding disbursement of loans under Tk 30,000 crore and Tk 20,000 crore packages for large, medium and small industries and the central bank will not refinance in the case of failure in recovery, he said.
‘So, we want credit risk scheme for loans, particularly for those to be disbursed to SMEs,’ he said.
Banks would deposit premium like insurance under the scheme and would get back money from the scheme if borrowers fail to pay back the loans, he said.
BRAC Bank managing director Selim RF Hussain said that the central bank should consult with stakeholders, including banks and trade bodies, before issuing any circular or guidelines to avoid frequent changes in regulations.
Around 70 circulars were issued in the last 40 days to clarify many issues, he said.
He also advocated simplification of regulations for SMEs as many of the provisions of the circulars were highly academic and unpractical for the SMEs.
Former FBCCI president Mir Nasir Hossain alleged that the private banks seemed not proactive in disbursement of loans under the two packages citing problems such as risk in loan recovery, which were not new and would persist always.
Making a delay on this excuse is not acceptable as any delay in disbursing the loans would not serve the purpose of the stimulus, he said.
FBCCI vice-president Siddiqur Rahman, former FBCCI presidents Qazi Akram Uddin Ahmed, Abdul Matlub Ahmad and Shafiul Islam Mohiuddin and former senior vice-president Md Jashim Uddin, current director Salahuddin Alamgir, Sonali Bank managing director Md Ataur Rahman Prodhan, Janata Bank managing director Abdus Salam, SME Foundation chairman Safiqul Islam and former World Bank Group senior economist Masrur Reaz, among others, spoke at the meeting.
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