BANK COMMENDED FOR SME LOAN
Prime Minister Hon. James Marape has commended Bank South Pacific for disbursing 830 Small to Medium Enterprise (SME) loans worth K119.9 million up to December 21, 2021.
This money is from the Marape Government’s K200 million SME Credit Enhancement Loan Scheme (SME CESL), K100 million of which had been given to BSP.
PM Marape said he was pleased that BSP had disbursed the K100 million from Government to SMES throughout Papua New Guinea, and given the demand for the loan facility, had added more money on top.
“Since the launch of the SME CESL facility in November 2020,” he said, “830 loans worth K119.7 million have been funded as at December 21, 2021,” he said.
“This is very-pleasing news indeed, as we celebrate Christmas, knowing that BSP has done the right thing by disbursing the K100 million we gave to them.
“I can assure BSP and the people of PNG that we will release this year’s funding of K100 million, as well as next year’s funding of K100 million, for them to draw down on.
“An additional K80 million has been given to the National Development Bank (NDB) to distribute to SMEs, however, disbursement has been slow because of administrative problems.
“I have already directed the board and management of NDB to explain why they have been very slow in disbursing the K80 million to SMEs.”
PM Marape, citing figures from BSP, said up to December 21, 2021:
• 830 funded SME loans totaling K119.7 million;
• 314 total approved pending funding totaling K55.5 million;
• 306 applications in pipeline totaling K102.4 million;
• Five non-performing (write-off) loans totaling 113,247.95;
• Seven non-performing (pending write-off) loans of 365,928.00;
• 22 30-day arrears of 141,577.76; and
• The SME CESL Support Account had Government funding of K99,886,752.05
“To date, a total of K113,247.95 in non-performing loans written off have been recovered from the SME CESL Support Account,” the Prime Minister said.
“The SME CESL fourth quarter report to the Secretary Department of Commerce and Industry is due at the end of December 2021 and as per the SME CESL agreement.”
PM Marape also announced that since its inception in 2014, over 1000 Papua New Guinean first-home owners, predominately working class families, had benefited from the BSP First Home Ownership Scheme Facility.
He said the previous government had introduced the scheme, however, had not supported it with the K200 million annual funding until his Government came into power.
“It is very encouraging to see Papua New Guineans now owning their own homes, with Government support, and I assure the country that we will continue to fund this,” PM Marape said.
Below is a summary of its performance as at 21 December 2021:
PM Marape, citing BSP figures, said:
• 1259 home loans totaling K448.5 million had been approved;
• A total 1086 home loans totaling K389.9 million had been funded;
• 21 30-day arrears totaling K6.99 million;
• 57 non-performing (write-off) home loans totaling K17.2 million; and
• Default rate of 4.4 per cent;
PM Marape said: “A total 1086 applications, representing 86 per cent of approved applications valued at nearly K380 million, have been funded.
“The current default rate of 4.4 per cent is within the bank’s provisions for bad and doubtful debt.”