A Study On Challenges for Financing Small & Medium Enterprises (SMEs)
2015; RELX Group (Netherlands); Linguagem: Inglês
ISSN
1556-5068
Autores Tópico(s)Indian Economic and Social Development
ResumoThe Small and Medium sized Enterprises (SMEs) play a vital role in the economic development of Afghanistan. According to CSO – (Y14) it has been estimated that there are 20m MSMEs operating in the country. The employment opportunities they create improves the livelihoods of millions of poor people, especially important in a country like Afghanistan which is still in the infant stage of development. This article is attempt to study the key challenges which compel SMEs not to avail any funded credit facilities at commercial banks. To find out the reasons, the sampling approach was adopted and therefore with the help of GB’s branches located in the country, total 45 respondents (SMEs) in the six key provinces of Afghanistan were interviewed such as in Qandahar, Herrat, Mazar-e-Sharif, Kondoz, Jalalabad and Kabul which is the capital of Afghanistan. Findings and analysis have been respectively jotted down in this paper and the details are given for perusal along with some recommendations.The Key Challenges are:1. Inability of SMEs to fulfill the 4 days consecutive mandatory cleanup within the life of loans (applicable on overdraft/running account) in addition with having maintained three times (Cr) account turnover, as per Da Afghanistan Bank (DAB). 2. Inability of SMEs to secure the loans against Shariah Qabala (Legal Title Deed) having minimum 150 percent loan coverage value. Otherwise.
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