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STIMULUS PACKAGE IMPLEMENTATION

Loan disbursement to farmers, SMEs growing at snail’s pace

HM Murtuza | Published: 02:11, Aug 07,2020

 
 

A file photo shows farmers carrying potatoes on baskets from a field at Sirajdikhan in Munshiganj.  Disbursement of the stimulus loans by the country’s banks to the farmers, low-income people, short-time traders, and cottage, micro, small and medium entrepreneurs has been growing at a snail’s pace after nearly four months of the launch of stimulus packages amid the coronavirus outbreak.— New Age photo

Disbursement of the stimulus loans by the country’s banks to the farmers, low-income people, short-time traders, and cottage, micro, small and medium entrepreneurs has been growing at a snail’s pace after nearly four months of the launch of stimulus packages amid the coronavirus outbreak.

From a Tk 3,000-crore stimulus package, five banks have so far disbursed Tk 266 crore to the non-governmental organisations to distribute the funds as loans to the farmers, low-income people, short-time traders, and CMSM entrepreneurs.

Whether the loans have reached the targeted people is yet remained unknown to the Bangladesh Bank, a BB official said.

He said that the central bank would only be able to know the status of the loans when the banks would apply to the central bank for refinance.

The country’s banks, however, have already implemented the stimulus loans for the export-oriented businesses fully and the banks have already disbursed one-third of the loans under the Tk 30,000 crore in stimulus package meant for the large industries.

The government, since the outbreak of coronavirus in March 8 this year, has announced several stimulus packages worth around Tk 1.03 lakh crore with a view to reviving the economy affected severely in last few months due to the deadly flu.

Economists have emphasised ensuring equal treatment for the implementation of all the packages announced to revive the economy instead of focusing only on the large businesses and the apparel sector.

But, the disbursement of stimulus loans to the farmers, low-income people and small-time traders, and CMSM entrepreneurs has remained very low.

Although the government announced Tk 5,000 crore in stimulus package for export-oriented industries’ workers’ salary, the banks have so far disbursed Tk 7,700 crore as the government revised up the fund size by Tk 2,700 crore.

The banks have already disbursed around a third of Tk 30,000 crore in stimulus loans meant for the large industries as the central bank asked the banks to implement the package fully by August this year.

On the other hand, the disbursement of loans from the Tk 20,000 crore in stimulus package meant for the CMSMEs remained around 3 per cent.

SANEM executive director Selim Raihan told New Age on Wednesday, ‘We have observed that every measure taken for the apparel sector was implemented at the quickest possible time.’

However, other packages or measures were not implemented at that pace, he said.

For the revival of the economy, emphasis should be given equally to all other sectors; otherwise the economic recovery would be slow, said Selim.

Unless the stimulus packages are implemented effectively or equally, the V-shaped economic recovery plan of the government would remain elusive, he said.

Meanwhile, the BB has formed a credit guarantee scheme in July to speed up the loan disbursement to the cottage, micro and small entrepreneurs.

However, the scheme is yet in a formation stage and would take time to become functional.

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