The Small and Medium Enterprise (SME) Foundation has asked for Tk200 crore to form a credit fund only for women entrepreneurs.
They requested the funding from the government incentive packages to offset the loss of the women entrepreneurs incurred by the pandemic and to expand their businesses.
Md Mafizur Rahman, managing director of the SME Foundation, sent a letter to the Industry Ministry on Sunday. Dhaka Tribune received the final copy of the letter.
In the letter, Md Mafizur Rahman said that the SME Foundation has successfully completed the allocation of Tk300 crore from the incentive package 5 months ahead of the schedule with significant experience and expertise.
“Considering this experience and expertise, there are opportunities to disburse more loans among the pandemic-hit women entrepreneurs through SME Foundation in the current financial year,” he added.
Rahman also said that to address the impact of the ongoing pandemic, there is a need to set up a separate fund for the underprivileged women entrepreneurs in rural areas so that they can keep their enterprises operational and expand it if needed.
“So, we are cordially requesting to take necessary steps to set up this fund and allocate the required funding of Tk200 crore in favour of SME Foundation,” Rahman added.
According to the letter, to lessen the impact of the pandemic in cottage, small and medium enterprises, and to improve the living standards of the rural marginalized people, the Prime Minister sanctioned a stimulus package of Tk1,500 crore.
“Under this incentive package, the government allocated Tk300 crore in favour of the SME Foundation and the SME Foundation disbursed Tk100 crore of the allocated fund to 925 entrepreneurs by June of the last financial year (2020-21) and disbursed the remaining Tk200 crore by January of the current financial year,” he added.
The foundation already distributed Tk300 crore among 3,108 entrepreneurs across the country, where 736 or 23.7% of the recipients were women, said the foundation’s managing director.
However, the government has allocated incentive packages of Tk40,000 crore in two phases for the disbursement of loans among cottage, micro, small and medium enterprises to combat the effects of the pandemic, expansion, and development.
According to the Bangladesh Bank, from the first-round worth of Tk20,000 crore, they disbursed loans worth Tk15,252 crore (77%), where 4.4% recipients were women entrepreneurs, said the letter.
According to the central bank, they allocated another Tk20,000 crore for the current financial year and so far, 39% of it has been disbursed between July 1 and March 10 this financial year.
Md Mafizur Rahman also said that they have discussed with their partner banks and NBFIs where both parties expressed the view that the loan disbursement rate for women was satisfactory.
“The foundation is also playing a significant role in various post-loan disbursement ancillary services such as market connectivity, ICT and technology support, skills development of entrepreneurs, proper utilization of loans and timely repayment of loans,” he added.
In this way, the expertise and experience of the foundation are increasing, which is creating immense opportunities for the disbursement of new loans only among the women entrepreneurs, he added.
According to the SME entrepreneurs, they are turning things around by recovering from losses suffered amid the pandemic through stimulus loans.
Hasina Akter, an entrepreneur from Tangail, told Dhaka Tribune that her business was on the brink of collapse with declining sales due to the pandemic.
“In October last year, I got a loan of Tk1.5 lakh at 4% interest from Bank Asia with the help of the SME Foundation,” she added.
According to the economic survey conducted by the BBS, more than 99% of the country's businesses are under the CMSME sector - employing 7.8 million – which is 80% to 85% of the total industrial employment of the country.
Currently, the SME sector is contributing around 25-27% to the national GDP and aims to increase the contribution to 32% by the year 2024.
