SMEs should get single digit lending facility: DCCI

Newly elected President of Dhaka Chamber of Commerce and Industry (DCCI) Shams Mahmud today demanded single digit loan facility for the Small and Medium-sized Enterprises (SMEs).

"I hope that the commitment of the government of bringing down lending rate to single digit would come into effect from April this year. Micro credit and banking loan to SMEs is different thing. So, SMEs should get single digit lending facility," he said.

The DCCI president said this while speaking at a press conference at the DCCI office in the city, said a press release.

Shams Mahmud said RMG is only the largest export earning sector for Bangladesh, but the country need to develop other sectors. To promote other sectors, he urged for bonded warehouse facility, back to back Letter of Credit (LC) to leather made products, tax rebate and new technology adoption.

He also said nearly 80 percent of exports are destined to North America and Europe and products sophistication has remained almost static.

Referring to a study of a2i, the DCCI president said, around 40 percent of all employment of Bangladesh from RMG and textile, agro food, tourism and leather has a risk of loss due to automation.

He called upon authorities concerned for strong collaboration of National Skills Development Authority and Bureau of Manpower Employment and Training (BMET) for need-based skill development.

Shams Mahmud said DCCI is going to establish a Research and Innovation centre (RnI) and giving it a separate entity for the development of SME.

He suggested figuring out willful defaulters for controlling the non-performing loan (NPL). "If someone fails to repay his loan due to delayed power or energy connections, he should not be considered as willful defaulters," he added.

He said soaring NPL would increase cost of doing business as it fuels cost of borrowers.

Regarding a question of government's bank borrowing, he said, some of the private sector companies are now availing foreign funds as their credit source. But it would be better for all to keep in between the target, he added.

The DCCI president underscored the need for a secondary bond market to develop the country's capital market.

"We welcome Prime Minister's intervention and her six concrete directions to revive the stock market," he added.