Premier Bank well ahead of SME loan target
To remove problems of SMEs in getting loan, the process of issuing trade licence to small businesses must be simplified and digitized.
Up to December 2020, total loan and advance stood at Tk 10,50,562.96 crore, of which SME loan accounted for Tk2,06,803.64 crore or 19.69% of the total loan disbursed.
The target set by Bangladesh Bank was 21% for 2020, which is 25% for 2024. SME loan accounted 29% of Premier Bank's total loan in 2020, which means the bank exceeded the target for 2024 four years ahead.
As per the instructions of the central bank, commercial banks are supposed to disburse minimum 40% of their SME loans to manufacturing units, 25% to service and maximum 35% to trading units.
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The achievements of all banks and financial institutions were 39%, 20.55% and 40.35% respectively, whereas Premier Bank's performance was 45.89%, 22.85% and 31.26% in 2020, according to Bangladesh Bank dada.
The numbers show Premier Bank not only exceeded the targets, but also maintained its strong position in various categories of SME financing. Premier Bank believes there is no alternative to financing the SMEs for creating jobs, reducing poverty and achieving a sustainable economic growth.
To remove problems of SMEs in getting loan, the process of issuing trade licence to small businesses must be simplified and digitized. At present, union parishads, municipalities and city corporations issue trade licences. But these local government offices do not maintain proper data of the businesses.
Here, SME Foundation can play a bigger role in the process in cooperation with the A2i Project of the Prime Minister's Office. Entrepreneurs also need skill training for better quality products and wider market.
"Premier Bank Limited always prefers banking beyond traditional one and is striving to be a bank of common people. With
this view in the back of our mind, we have given focus on MSME business and been able to achieve all MSME business targets set by the Bangladesh Bank in 2020," said M. Reazul Karim, FCMA, Managing Director and CEO of the Premier Bank Limited.
So the celebration of World MSME Day-2021 holds immense pleasure for Premier family, he added.
