Bangladesh Bank has disbursed loans amounting to Tk 5,831.39 crore as of April 30 from its seven refinance schemes for the country’s disadvantaged entrepreneurs, which has played an important role in raising the capacity of small and medium enterprises.
The majority of clients have taken the credit from the schemes with a lower interest rate of 8 to 9 per cent that has help the entrepreneurs to open new businesses or to expand the existing ones, a BB official told New Age on Thursday.
The central bank introduced refinance scheme for the first time in November, 2001 for entrepreneurs engaged in agro-based products processing industries in the rural areas.
Under the refinance schemes, banks disburse loans to their clients from their own sources after which they get the amounts from the BB.
The central bank provides the fund to banks with an interest rate of five per cent and they (banks) in most of the cases add three to four per cent on the rate while disbursing the loans to their clients.
The BB is now operating seven refinance schemes under its SME and special programmes department.
The Asian Development Bank and the Japan International Cooperation Agency have given financial support to two of the seven schemes, the BB official said.
The seven schemes are worth Tk 3,203.26 crore, but clients have so far got loans amounting to Tk 5,831 crore from the programmes as five of the schemes are revolving fund in nature.
The BB official said that new and woman entrepreneurs often faced difficulties in getting loans from banks due to their lower prominence.
‘Besides, entrepreneurs in the rural areas are also deprived of getting loans from banks. The central bank introduced the refinance schemes with the aim of bringing the underprivileged entrepreneurs under the banking system,’ he said.
The BB’s seven refinance schemes under the SME and special programmes department are: refinance scheme for setting up agro-based product processing industries in rural areas, small enterprise scheme, refinance scheme for Shariah-based financing in agro-based industry, refinance scheme for new entrepreneurs in cottage, micro and small enterprise sector, medium-sized enterprise development project and financial sector project for development of SME and urban building safety project.
Loan disbursement through the refinance schemes has created a number of SME-oriented clusters as banks earlier disbursed loans to the entrepreneurs of a single cluster in a same period.
When banks face liquidity crunch, the refinance schemes play a significant role in providing loans to the entrepreneurs as the finances for loans under the schemes are injected from the central bank’s custody, the central banker said.
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