Bangladesh: First instalment of the Asian Development Bank’s special loan for SMEs disbursed
The first instalment of the ADB's special loan for development of the country's small and medium enterprises (SMEs) has been disbursed to seven banks and financial institutions at the Bangladesh Bank (BB) in the capital Tuesday.
BB Governor Salehuddin Ahmed distributed the fund disbursement letters to the functionaries of the concerned institutions. ADB's Country Director Hua Du attended the function as special guest.
The Asian Development Bank sanctioned a total loan of US$ 50 million for SME development in 2005. Out of the money, $15 million has been allocated for developing rules and regulations and executing necessary institutional reforms supportive to the SMEs development.
Another $5.0 million has been earmarked as technical assistance for training and capacity building in this sector. The remaining $30 million has been placed for distribution to the banks and financial institutions with a view to strengthening their SMEs funding activities.
The day's disbursement to the tune of $2.8 million (Tk 197 million) is part of this fund and the first of its kind from the above fund.
The seven recipient bodies are One Bank Ltd, Eastern Bank Ltd, Peoples Leasing and Financial Services Ltd, Midas Financing Ltd, Industrial Development and Leasing Company of Bangladesh Ltd, Islamic Finance and Investment Ltd and Uttara Finance and Investment Ltd.
Speaking on the occasion, the BB governor said ADB's loan for SMEs development would play a significant role in combating poverty and empowering the women in particular.
He said growing funding to SMEs would help accelerate the pace of the country's economic growth.
This fund would play significant role at a time when the country is suffering from scarcity of investment capital. "We need new jump-start and this loan will play that role," he said.
Hua du expressed similar hope saying she remained worried on delay in utilising the fund. Referring to a visit of a team of young entrepreneurs of the light engineering sector to her, she said they were happy on the prospects of development that the loan may bring to them.
But they are equally apprehension about how they can get benefit of this loan. Hua Du said she held discussion with the industries minister on this issue and she believed the fund would reach the end users.
In this connection, she also stressed the need for strengthening the SMEs foundation. ADB would continue to support SME sector development in the country," she assured.
Source: Financial Express
