President asks banks to help SMEs

Wednesday, 20 May 2020 00:40 - - {{hitsCtrl.values.hits}}

President Gotabaya had told the State and private sector banks according to newspapers to look after the SMEs.

‘Help them now, they are honourable people; check your bad loans most of them are these big people who don’t pay their loans; the small man is honourable and gets fleeced by the middleman,’ the President had told at the meeting. Very true. All these so-called businesses tycoons who drive in their fancy cars (suspect all leased from the banks and some may be in arrears) live off the banks. Look at the annual reports of banks to see how these big companies have overly borrowed. These companies are too big to be allowed to fall. So banks continue to pump them money simply due to the fear of losing the money they have lent. Big businessman know this and continue to carry these banks to their grave.

These businessman are cunning and shrewd. They entertain their lenders with wine and song. Happily they get their credit lines. The SMEs have no power to give gifts or entertain these bank executives. So they are dished out the crumbs. They are rudely dealt with and seen as rouges. I am happy at least this President has realised this.

The former President who was from the village of Polonnaruwa did nothing for the SME sector. Banks that were focusing on the SMEs have now become big corporate banks. DFCC, HNB and Commercial Bank. What are two State giants that control 60% of the banking business doing?

The President should set up a development bank to do this. Do it now, if not the SMEs will never get up after COVID-19. The economy will only take off again if the SMEs are financed. While you cannot expect private sector banks to sacrifice their deposits to fund SMEs only, they cannot also be allowed squander money on big businessman. The Central Bank should study the lifestyles of these bankers and borrowers.

Bert

Colombo 3