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Commercial banks deny smaller loans
- Small businessmen affected
BIRATNAGAR, NOV 16 - Refusal of the commercial banks to disburse loans less than one million rupees has caused inconvenience to the local entrepreneurs, who were heavily dependent on the banks’ loans to run their cottage and small-scale industries.
"To expand my business, I visited several banks in search of loans. However, no commercial banks agreed to lend me less than one million rupees," lamented Siya Ram Rauniyar, who runs a rickshaw repairing business.
He said that he neither needed such a huge amount nor he had collateral enough to draw one-million rupee loan from the commercial bank.
Manoj Agrawal, a local entrepreneur, said that he was trying to set up a furniture factory taking loans from a local bank.
"But, I could not open the factory as the bank refused to provide me loans. The bank officials asked me either to draw loans more than one million rupees against collateral or to go to the Agricultural Development Bank (ADB) for the propose."
He said that there was no use of taking such a huge loan for an entrepreneur like him.
The local entrepreneurs said that they are quite confused with the policy of the banks. At a time when the government accords special priority to the cottage and small industries to boost the economic activities of the country, such decision of the banks is quite discouraging, they said.
Stating that the commercial banks refused to disburse small loans, as many as four entrepreneurs have filed a request letter with the Morang Traders Association hoping that it would take initiative to resolve the problem.
At present, the ADB has been disbursing loans to the cottage and small industries. But, its interest rate is as high as 16 percent per year. However, the commercial banks have their own story to narrate.
Sushil Acharya, Chief of Biratnagar branch of Rastriya Banijaya Bank (RBB), said that the RBB has disbursed loans even to the entrepreneurs operating the cottage and small industries.
"But as per the new policy of the bank, aspirant borrowers have to get permission from the head office of the bank," he said. "So, it is being difficult for the entrepreneurs to draw the loans from the bank."Posted on: 2003-11-15 09:38
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