The SME Foundation intends to provide low-cost financing at 6% interest, which is significantly less than the present bank rate of more than 13%, to small and medium-sized firms that are having a difficult time obtaining loans to grow their operations.
The state-run institution will contribute Taka 450 crore from a revolving fund established under a Government stimulus package and its own sources to help traverse the obstacles of the pandemic for the restoration of SMEs, who were the most severely impacted by COVID-19.
A minimum loan of Taka 1 lakh and a maximum loan of Taka 25 lakh are available to small and medium-sized business owners under the plan. However, enterprises are only eligible for a maximum loan of Taka 50 lakh for the purchase of capital gear. Loans of up to Taka 10 lakh will be disbursed without collateral.
Four non-bank financial institutions and 19 state- and privately-owned banks will disburse the loans. There is a six-month grace period added to the 48-month loan repayment term. To achieve this, the foundation signed agreements with 23 banks and other entities.
Salahuddin Mahmud, managing director (additional charge) of the SME Foundation, and the CEOs of 19 partner banks and four financial institutions signed the agreements.
