FEBR for make procedure easier for obtaining loan from the banks for business concerns
LAHORE: Friends of Economic and Business Reforms (FEBR) President Kashif Anwar has expressed his dismay over non-compliance of government’s order to the port and shipping authorities’ especially private terminals who have not extended free detention and demurrages charges period amid the testing times when whole world is combating with the COVID-19 pandemic.
“FBR is continuously writing concerned authorities to give favor regarding detention and demurrage to all importers either industrial or commercial but of no use. No one is listening to them,” Kashif Anwar stated.
Separately he also wrote to a letter to the Minister Industry and Production Muhammad Hammad Azhar and communicated importers and businessmen grievances.
The letter reads, “As you know that every citizen of Pakistan is severely affected due to pandemic COVID-19 in the country. Since 22nd March 2020, majority of the markets, industries, private businesses are closed except some exempted sectors and because of closure of businesses everyone cash flow is badly affected. It is true that the Government of Pakistan is trying its level best to facilitate the business community and different Ministries are devising strategies to facilitate the people when everyone is facing severe financial crunch.”
In the letter FEBR President said, “We know that you have a keen eye on the critical situation of economy but we still want to bring some issues in your kind notice”.
He said that Ministries did make policies but concerned departments and offices failed miserably in following those instructions with true spirit.
Citing example of demurrages and detention, he said a very good example is of not charging detention and demurrage at the ports.
“FBR is continuously writing concerned authorities to give favor regarding detention and demurrage to all importers either industrial or Commercial but of no use. No one is listening to them,” he said.
“Another example is of electricity bills, the due date of payment for the month of March was extended till 7”. April as issued by the electricity supply companies but banks are charging surcharge amount and they present an excuse that they have received any instruction of not deducting late payment charges”, he said adding that such time has come that those companies who used to work with their own capital are currently looking for bank assistance to run their daily affairs.
In order to facilitate SME, SBP has announced to defer the principal amount of loans for one year with the condition to pay mark-up regularly. Secondly, borrow the amount of salaries of staff for the month of April, May and June 20 at 4% mark-up for 2 years if they are not removed from their jobs.
“We want to submit very sympathetically that the process of obtaining loan from bank and fulfill those formalities are so cumbersome that majority of entrepreneurs will not be able to avail these facilities” he said in the letter.
“Currently, every business’s cash-flow has disturbed because of lockdown and those who are working, their supply chain is incomplete either supplier is missing or customer is not available. It has become unmanageable for every individual and business concern in the absence of cash flow to pay utility bills of electricity, gas, water, telephone, mobile and other payments like income tax, sales tax, social security, education cess, EOBI and many others to meet. At this time we have no other door to knock for help except that of Government of Pakistan,” the FEBR president highlighted.
In order to help the business community and face this hard time, we again most humbly recommend the following proposals and hope they will be taken up by your good self to facilitate the SME’s.
1 Make the procedure easier for obtaining loan from the banks for business concerns.
2 Allow the payment of utility bills for the month of March, April, May & June 2020 including electricity, gas, telephone, mobile, water either residential, commercial or industrial without late fees and disconnection until the business activities are normalized.
3 Allow all treasury payments like income tax, sales tax, social security, education cess, EOBI and others to be deposited after their due dates without any penal action or fines until the business activities are normalized.
- SME sector which is the back bone of our economy and is a source of employment generation and revenue for exchequer, they must be given same importance as of export sector and also given loan from banks at 6% so they can face the economic and financial challenges.
5 All the existing loans in any shape taken from any bank by individuals, retailers, SME may be rescheduled at 6% mark up till June 2021.
If government will not make implementable short and medium term policies for businesses to bear the pandemic effects of cOVID-19, it is worth mentioning that many businesses will not be in position to continue their affairs smoothly and will default which will directly and indirectly affect other businesses.
