COVID-19 Outbreak

Businesses for ensuring small enterprises’ access to stimulus

Staff Correspondent | Published: 23:10, Jun 23,2020

 
 

A file photo shows a customer holding a bag at a stall at a SME fair in Dhaka. Experts and businesses on Tuesday stressed the need for preparing a database of COVID-19 affected cottage, micro, small and medium enterprises and ensuring their access to the government announced stimulus packages.— New Age photo

Experts and businesses on Tuesday stressed the need for preparing a database of COVID-19 affected cottage, micro, small and medium enterprises and ensuring their access to the government announced stimulus packages.

Implementation of the stimulus package for the sector will not be successful without a proper database of the CMSMEs and easing of banking regulations, they said.

Micro finance institutions should be involved in disbursement of the fund, they said.

Most of the micro enterprises belong to the informal sector and they will not be able to get access to the fund as it is being disbursed through the banking channel, they said.

At a virtual dialogue on the COVID-19 economic crisis and SMEs of Bangladesh, they also said that an innovative and holistic approach to easing regulatory restrictions and ensuring easier access to the stimulus fund would be required to address the coronavirus fallout for the sector.

Resurgent Bangladesh, a platform of the Metropolitan Chamber of Commerce and Industry, the Dhaka Chamber of Commerce and Industry, the Chittagong Stock Exchange, Business Initiative Leading Development and Policy Exchange, arranged the dialogue.

MCCI president Nihad Kabir said that small enterprises would not get access to finance due to regulatory practices.

Both small and medium enterprises have to abide by the same rules and regulations despite the huge difference in the size, capital and employment between the two types of businesses, she said.

Small borrowers are unable to abide by the regulations followed by the medium or large borrowers, she said, adding that a long-term financing strategy was needed for the SMEs.

Only Tk 30 crore was disbursed against the small enterprises from the Tk 2,000 stimulus package until Eid-ul-Azha, she added.

Industries minister Nurul Majid Mahmud Humayun said that the ministry would take steps to quickly prepare and update the database of the CMSMEs so that the affected enterprises could get access to the stimulus.

A complete database will make the disbursement process easier, he admitted.

He said that a committee headed by the district commissioner was working to identify the actual affected enterprises during the COVID-19 pandemic.

BUILD chairman Abul Kasem Khan said that the SMEs were the worst hit victims of the outbreak and effective refinancing and expansion of the local market for products would help the sector to overcome its losses.

CSE chairman Asif Ibrahim said that the government had set a good example of stimulus package disbursement to the RMG workers through mobile banking accounts, and similar efforts should be undertaken for disbursing the SME credit. DCCI president Shams Mahmud said that disbursement of funds remained a stumbling block for the affected SMEs which needed to be addressed.

Policy Exchange chairman M Masrur Reaz said that access to finance was now the most important issue for the SMEs and the government should ensure it by addressing the constraints behind the issue.

SME Foundation managing director Safiqul Islam recommended that disbursement of the stimulus package could be ensured by utilising the credit wholesaling programme of the foundation.

Former National Board of Revenue chairman Nasiruddin Ahmed, BUILD chief executive officer Ferdaus Ara Begum, Bangladesh Institute of Development Studies senior research fellow Monzur Hossain, Creation Ltd managing director Rashedul Karim Munna and Tarango chief executive officer Kohinoor Yeasmin, among others, spoke at the programme.

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