Disburse money from virus stimulus package quickly, FBCCI chief urges banks

FBCCI on Wednesday urged the country’s banks to take quick steps to disburse the stimulus money declared by the government to stave off the impact of the coronavirus on the economy.

Sheikh Fazle Fahim, president of the apex trade body said the banks should play a pro-active role by adopting easy ways to help the country’s cottage, micro, small and medium enterprises get their share from the package of 20,000 crore taka announced by Prime Minister Sheikh Hasina.

He stressed the need for engaging the FBCCI members -- all chambers and associations—to provide small shops, clinics and hospitals, women entrepreneurs and media houses with stimulus funds.

The chief of the apex business body requested the Association of the Bankers Bangladesh (ABB) to expedite the process as the coronavirus crisis has put various sectors under serious strains. 

Sheikh Fahim made the statement in a discussion titled “Roadmap to Stimulus Loan Execution 20,000 crore and 30,000 crore”.

The discussion, which was held at the FBCCI Tower in Motijheel, was also participated by chairmen and managing directors of various state-owned and private banks, former FBCCI presidents, FBCCI directors and economists.

Fahim said the government-announced stimulus package was “targeted and focused” but now it was the responsibility of the banks to do the rest. He said to help the national economy survive the banks must come forward to quickly execute the plans for stimulus package.

“The decision to provide food assistance to 4 crore people, Tk 700 crore for the workers in the informal sector, Tk 20,000 crore for the SME sector, Tk 30,000 crore for the large sectors, Tk 5,000 crore for the export-oriented sector, Tk 5,000 crore for the agriculture sector is a bold step. Now the banks should shoulder the responsibility for the interest of the national economy,” he said.

Welcoming the Bangladesh Bank’s various steps to resolve the liquidity crisis in the banking sector, Fahim said the central bank’s decisions have strengthened the base for the banks to disburse the stimulus money in a disciplined manner.

“For the Bangladesh Bank’s steps the banks’ liquidity is supposed to increase up to Tk 46,000 crore and it is supposed to be Tk 70,000 crore with Export Development Fund (EDF) while through the statutory liquidity ratio (SLR) there should be an excess fund of Tk 1 lac crore.  Under the stimulus package the facility for subsidy for interest and matching fund option would benefit the banks,” Fahim said.

“Under such schemes the state-owned banks and the private banks can forge a strong partnership so that they can work together and provide support to various sectors, especially the SME sector,” he said.

Fahim also said if the country’s burgeoning informal sector can survive through the crisis with the contribution from the state-owned and private banks this informal sector will be integrated into the formal sector one day.

“This will be a win-win situation, and the banks will also benefit enormously through this inclusion,” he said.

FBCCI’s former president and Member of Parliament Shafiul Islam Mohiuddin said steps should be taken so that the entrepreneurs, especially the smaller ones, do not face troubles in getting stimulus money for documentation.

He proposed FBCCI should set up a “Help Desk” to provide support to such small businesses.

He said better coordination among regulators such as the National Board of Revenue, the Bangladesh Bank, FBCCI and other associations is necessary.

Chairmen and managing directors of the state-owned and private banks thanked the government and the Bangladesh Bank for taking steps for eliminating liquidity crisis in the financial institutions. Supporting the statement, Ali Reza Iftekhar, Chairman of the Association of Bankers Bangladesh  (ABB) said it would be easier to implement the plans for stimulus package as there was no liquidity crisis in the country.

Iftekhar said the banks are ready to disburse money “speedily and timely” subject to proper documentation. He sought help from the FBCCI to ensure realizing the money from the borrowers and promised to formulate a checklist for the borrowers’ documentation.

SME Foundation’s Managing Director Safiqul Islam said the banks should change their attitude towards the SMEs and they should “respond quickly” to disburse the stimulus money for the sector.

“It would be really good if we can reach out to the SMEs with the 20,000 crore fund. We will not benefit if the money does not reach the country’s cottage, micro and SME sector quickly,” he said.

Safiqul said that cottage industry’s 70 percent is based in rural areas and they are afraid of integration with the formal sector. But if they are excluded the mainstream economy will suffer, he said, adding that the banks must come forward to help the small businesses survive.

FBCCI Director Monir Hossain said it was a good news that the banks have no liquidity crisis, but the branches of various banks have not received instruction yet about the stimulus package of Tk 20,000 crore.

“The branch officials say they have no idea. But the circular for the stimulus package was issued much earlier. This is unfortunate that the branch level officials have no instructions from the banks’ high-ups,” he said. “You are seeking help form the FBCCI, but how can we help the banks unless you communicate your branch officials about the stimulus package?” he said.

The discussion was also attended by Kazi Akram Uddin Ahmed, Mir Nasir Hossain and Abdul Matlub Ahmad, former presidents of FBCCI, Janata Bank Chairman Jamal Uddin Ahmed and its Managing Director Abdus Salam Azad, Sonali Bank’s Managing Director Ataur Rahman Prodhan, BRAC Bank’s Managing Director Selim R F Hossain, FBCCI’s Senior Vice President Muntakim Asharf, Director Salahuddin Alamgir, President of Bangladesh Plastic Goods Manufacturers and Exporters Association Jashim Uddin and Chairman of Policy Exchange Masrur Reaz.

-rmc////