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SME financing at a remote area in Bangladesh
A Case study at Sonali Bank Limited, Dimla Branch, Nilphamari.
Small and Medium Enterprises (SME) have historically been one staples of the enterprise landscape within economics globally. Especially growth with clear benefits for poverty reduction puts a premium on integrating, productively and profitably, small and medium enterprises in the very process of economic growth. A historically accelerated pace of trade liberalization in Bangladesh since the early 1990s by spurring a veritable deluge of imports has quite significantly increased competitive pressure on SMEs in Bangladesh.. Government of Bangladesh formulated a comprehensive Industrial Policy-2005 by putting special emphasis for developing Small and Medium Enterprises (SMEs) as a thrust sector for balanced and sustainable industrial development in the country to help deal with the challenges of free market economy and globalization.
1.2 Objective of the study
The prime objectives of the orientation are:
1. To study various activities of Sonali Bank Limited.
2. To study about the SME financing at a remote area.
3. To give an overview on SME services of Bangladesh.
4. To give preface SME Banking in Bangladesh.
5. To present description of Economical contribution of SME.
6. To find out about the Problems and Prospect of SME.
7. To locate and give some Recommendations.
1.3 Methodology of the study
The report is based on both primary and secondary sources of information.
A) Primary Data
1. Interviewing the managers, officers & customers of the bank has provided the primary sources of information.
2) Overview the various activities of the Bank.
3) Studying the SME banking of the Sonali Bank Limited.
4) Physical survey in the field level.
B) Secondary Information
1. Annual Report of the Bank
2. Journal related with the SME Banking & Financing
4.”SME Finance” Sonali Bank Limited Training guideline.
1.4 Limitation of the Report
Although I have received co-operation from the concerning body but most of the time they were busy with their work that’s why I did not get so many time, as I would like to have. The administrative authority, management policy and decision making policy is in the hands of the head office. As a BBA student it is needed to gather the experience that, how to take the decision when the bank fall into a program and what is it’s management policy, how to set up their portfolio, what is their business strategy but a branch does not do so.
The following limitations are apparent in the report:
• Time is the first limitation as the duration of the program is very few days only.
• Another limitation of the report is Banks policy is not disclosing some data and information for obvious reason, which could be very much useful.
2.1 Profile of Sonali Bank
Sonali Bank Limited (SBL) was incorporated on 3 June 2007 as a public limited company under Companies Act 1994 with its Head Office at Dhaka. The bank governed by the Banking Companies Act 1991 as a Commercial Bank. SBL took over the business of Sonali bank on 15th November, 2007 with all its assets benefits, rights, powers, authorities, privileges liabilities, borrowings signed between the Government of the peoples Republic of Bangladesh and Sonali Bank Limited.
2.2 Main Objective
The main objective of the bank is to provide all types of banking services to the door steps of the people. The bank participates in various socio-economic activities and development programs. It also takes part in implementation of various plans and programs made by the Government. As the largest state owned commercial bank, Sonali Bank Limited has the responsibility to run it as a service-oriented and professionally managed leading profitable organization of the country.
2.3 Corporate Profile
Name of the Company : Sonali Bank Limited
Chairman : Quazi Baharul Islam
CEO and Managing Director : Pradip Kumar Dutta
Company Secretary : Zaheed Hossain
Legal Status : Public Limited Company
Date of Incorporation : 03 June, 2007
Date of Vendor’s Agreement : 15 November, 2007
Authorized Capital : Taka 2000.00 core
Paid-up Capital : Taka 1125.00 core
Number of Employee : 21,839
Number of Branches : 1198
Phone-PABX : 9550426-31, 33, 34, 9552924
FAX : 88-02-9561410, 9552007
SWIFT : BSONBDDH
Website : www.sonalibank.com.bd
E-mail : email@example.com
2.4 Management Hierarchy
2.5 Organ gram
2.6. Products and Services of Sonali Bank Limited
New Deposits products:
1 Sonali Deposit Scheme (SDS)
2 Education Deposit Scheme (EDS)
3 Medicare Deposit Scheme (MDS)
4 Rural Deposit Scheme(RDS)
5 Monthly Earning Deposit Scheme (MEDS)
6 Marriage Deposit Scheme (MSS) have been introduced
1 Small and Medium Enterprise loan (SME)
2 Special small loan (SSL)
3 Rural Small Farming Loan
4 Poverty Alleviation Assistance Program ( Daridra Bimochone Sahayata Karmasuchi ) etc. have been introduced
2.7. The Banks activities during 2010 to 2011 (Fig in Thousands)
SL No. Particulars 2011 2010
1. Paid-up Capital 11,250,000 9,000,000,
2. Total Capital (as per Capital Adequacy) 44,208,880 3 0,400,267
3. Total Assets 695,604,597 620,514,960
4. Total Deposits 5 33,192,166 478,134,084
5. Total Loans and Advances 3 45,991,348 286,098,070
6. Credit Deposit Ratio 64.72% 59.84%
7. Percentage of classified loans against total loans and advances 18.53% 23.88%
8. Profit after tax and provision 9,957,218 974,510
9. Return on investment (ROI) 13.11% 9.39%
10. Income from investment 1 4,788,203 5,196,256
11. Cash 65,634,773 33,230,634
12. Total Property and Asset 695,604,597 620,514,960
13. Total Liabilities 6 39,099,806 583,104,063
14. Unclassified 81.40% 76.08%
15. Classified 18.53% 23.88%
16. Net Profit for the year 8,019,733 1,364,510
2.8. Ancillary Service
Sonali Bank Limited offers multiple special services with its network of branches throughout the country in addition to its normal banking operations.
• Gas bills.
• Electricity bills.
• Telephone bills.
• Water/Sewerage bills.
• Municipal holding Tax.
• Passport fees, visa fees and Travel tax.
• Customs & Excise duties.
• Source tax and VAT.
• Jakat fund.
• Hajj deposit.
• Pension of employees of Government and other Corporate Bodies.
• Bangladesh Bank employee’s pension.
• Army pension.
• British pension.
• Students’ stipend/scholarship.
• Govt. & Non-Govt. Teachers’ salary.
• Food procurement bill on behalf of the Govt.
• Old age allowances.
• Widows, divorcees and destitute women allowances.
• Freedom Fighters’ allowances.
• Rehabilitation allowances for acid survival women.
• Maternal allowances for poor women.
• Disability allowances.
Sale & Encashment/Purchase:
• Savings Certificates.
• ICB Unit Certificates.
• Prize Bonds.
• Wage Earner’s Development Bonds.
• US Dollar Premium & Investment Bond.
• Lottery tickets of different Semi-Govt. and Autonomous Bodies.
• Public Service Commission’s application form.
• Judicial Service Commission’s application form.
• Exchange of soiled / torn notes.
• Bank a/c information of tax payee client according to demand of NBR.
• Local Governance Support Project.
• Enlist of Non Government Insurance Company.
Secured Locker Service is provided in some branches of Sonali Bank Limited. Customers may avail this service and secure their valuables.
Bank’s own in-house software “Remittance Management System” (RMS+), having, among others, the feature of paying foreign remittance instantly over the counter is being implemented at all branches. This web based software provides digital services to the expatriates through its unique advantage of sending confirmation message to the mobile phone of the remitter/beneficiary.
Sonali Bank Limited is a member of Q-Cash ATM network. At present the bank has 53 ATM booths. Sonali Bank’s ATM cardholders enjoy the access to the ATMs and POS of Dutch Bangla Bank Ltd. and Brac Bank Ltd. besides those of Q-Cash consortium. Sonali Bank recently launched Credit Card.
Online and SMS Banking:
At present 109 branches of Sonali Banks are included in the Online Any Branch Banking (ABB) network. SMS Banking service is running in 73 branches. The bank is seriously working on connecting all branches in the Real-time Online Banking network gradually. Branches having ABB facility are also rendering SMS banking services.
2.9. Features of SBL Q-Cash ATM Network:
• Sonali Bank Limited has introduced Proprietary Debit & Credit cards.
• Card holder can easily pay utility bills like- Water, Telephone, Gas etc.
• It is easy to remit funds among the participating branches of the Bank.
• 24 hours Transactions is available.
• It is a risk less Cash Carrying facility.
• Cashless purchase can be made from specific Point of Sales (POS).
• Only designed Branches of Bangladesh deal Q-Cash cards.
• Branches of District and Upazilla level will introduce Sonali Bank Q-Cash card within shortest possible time.
According to the latest circular of BANGLADESH BANK (Date – 26/05/2008), the definition of Small & Medium Enterprise sector is given below:
Small Enterprises – Small enterprises refer to those enterprises which are not any Public Limited Companies and which fulfill the following criteria- Service Concern- Having an investment of Tk. 50,000 to Tk. 50,00,000 excluding land & building and / or employing up to 25 workers.
Business Concern – Having an investment of Tk. 50,000 to Tk. 50, 00,000 excluding land & building and / or employing up to 25 workers.
Manufacturing Concern – Having an investment of Tk. 50,000 to Tk. 1, 50, 00,000 excluding land & building and / or employing up to 50 workers.
Medium Enterprises – Medium enterprises refer to those enterprises which are not any Public Limited Companies and which fulfill the following criteria- Service Concern- Having an investment of Tk. 50,00,000 to Tk. 10,00,00,000 excluding land & building and / or employing up to 50 workers.
Business Concern – Having an investment of Tk. 50, 00,000 to Tk. 10, 00, 00,000 excluding land & building and / or employing up to 50 workers.
Manufacturing Concern – Having an investment of Tk. 1, 50, 00,000 to Tk. 20, 00, 00,000 excluding land & building and / or employing up to 150 workers.
According to the Industrial policy 2005, small and medium enterprises shall be categorized using the following definitions:
a. Manufacturing enterprise:
Small enterprise – an enterprise should be treated as small if, in current market prices, the replacement cost of plant, machinery and other parts / components, fixtures, support utility, and associated technical services by way of capitalized costs (of turnkey consultancy services, for example), etc, excluding land and building, were to be up to tk. 15 million;
Medium enterprise – an enterprise would be treated as medium if, in current market prices, the replacement cost of plant, machinery and other parts / components, fixtures, support utility, and associated technical services by way of capitalized costs (such as turnkey consultancy services), etc, excluding land and building, were to be up to tk. 100 million;
b. Non-manufacturing enterprise:
Small enterprise – an enterprise should be treated as small if it has less than 25 workers, in full time equivalents; Medium enterprise – an enterprise would be treated as medium if it has between 25 and 100 employees. SME finance is the funding of small and medium sized enterprises, and represents a major function of the general business finance market – in which capital for different types of firms are supplied, acquired, and coasted or priced.
The economic and social importance of the small and medium enterprise (SME) sector is well recognized in academic and policy literature. It is also acknowledged that these actors in the economy may be under-served, especially in terms of finance.
1. Information based lending usually incorporates financial statement lending, credit scoring, and relationship lending.
2. Viability based financing is especially associated with venture capital.
The term small-scale industry ids used everywhere both in developed and developing countries to denote the character of a particular size of industry .but its implications varies from country to country on the basis of this section importance in the economy ,the nature of the economy or its stage of economic development ,the type of industry ,period in question ,nature of the research object or the researcher’s objective and many other considerations .even in the single country the definition varies from time to time due to changes of above factors .
3.3 Factors Essentials for growth for SMEs:
The right technology is related to the characteristics of the sub –sectors of small and medium enterprise (SMEs) and the markets both present and potential .in fact ,it should be capable of being modified to suit local needs and local imports .technology ,which is economically acceptable ,should be identified and discriminative in an appropriate manner without which economic objectives could not be achieved ,on which rests socio –economic stability of paramount nature .
SMEs –should keep three points in mind when assessing and selecting technologies.
3.3.1 Domestic demand
Small business should avoid rushing to penetrate the mire difficult export markets .Domestic market may be, the first preferences, and for this technologies should be selected which are domestically available. However, it may be ensured that the products produced, on this basis, meet the quality requirements of the domestic market.
3.3.2 Domestic economic resource
The dependence of certain technologies on foreign resources often constitutes a serious weakness for small business in developing countries. Hence, technologies that uses domestic raw materials, energy sources etc. may be advantageous and may be supported or enforced by public policies.
3.3.3 Technologies Transfer
The performance of an enterprise is the product of qualifications of its people and continued training serves the purpose of improving intellectual capital .effective training can help individuals improve their current job skills, learns new skills and eventually provides an edge to the organization in the form of increased output .when designing a training program, it should be strategically aligned with the organizational vision.
Customer’s services training program is a very effective communication tool .enhancing intellectual capital of SMEs is one of the very critical tools for survival and growth .it helps increase productively and can serve as effective marketing tools.
With the birth of the internet, communication means emerged as a universal platform for everybody to meet .exchange information .and to ultimately make deals and is far less expensive and easily affordable by SME –sized businesses, eventually making it much easier for them to invest in. this capability arising out of the availability of the internet to handle business transactions with supreme ease has resulted electronic commerce attractive to small and medium sized businesses.
Smaller firms may in fact benefit from the opportunities offered by electronic commerce as they are unencumbered by existing relationships with traditional retail outlets or a large sales force. They may adopt a business model that forces larger, established competitors to restructure their existing relationship.
3.4 Present scenario of SME financing in Bangladesh
Demand side Problems
Right amount of fund at right time
SME financing lends money for the Small and medium sized enterprise .In most of the cases poor people cannot arrange large amount of money. So SME lend money to this small and medium enterprise. So they got money in right time and in right fund
Lack of capital
In most cases poor, middle class and lower middle class people want to be self depended by doing some business. By doing this business they become earn money. But some time they could enlarge their business because of lack of the capital. SME helps in this case and fulfilled their demand
Lack of access to formal credit
Most of the Banks and financial institution lend money to the large enterprise .SME financing is one of the formal credit to overcome this matter
Lack of collateral
In the case of SME most of the people are not solvent .In the case of any loan they could not manage collateral .Primary security needs not collateral but the secondary security needs collateral.
Supply- side problems
Administrative cost for Banks are high
In the sector of the SME loan the administrative cost of all the banks are high. So the administrative cost should be lessening.
In the SME loan there is higher risk because most of the people are poor and this is a high risk for them
Charge high interest rate
Most of the banks of SME loan has a high interest rate .So the interest rate should be lessen.
3.5 The Economical contribution of Small and Medium Enterprise
In Bangladesh, SMEs playing a significant role for the development of our economy by creating employment opportunity and producing important alternative machines and machinery parts for saving huge foreign currency for our country. So as a part of our development strategy, we should intensify our efforts to develop this sector to grow industrial base and volume of foreign trade. As we know that in this age of globalization, it is impossible to stop the flow of foreign goods to any country. Only quality products can meet the challenges in global market. For meeting this situation SMEs need to upgrade their technological capabilities and production facilities in order to produce quality products at a competitive price.
There is a great interest in small and medium enterprises (SME) as a major plank of poverty reduction in Bangladesh. The government has formulated a comprehensive industrial policy 2005 by putting special emphasis for developing SMEs as a thrust sector for balanced and sustainable industrial development in the country to help deal with the challenges of free Market economy and globalization.
The economy has grown 5-6% per year since 1996 despite political instability, poor infrastructure, corruption, insufficient power supplies, and slow implementation of economic reforms. Bangladesh remains a poor, overpopulated, and inefficiently-governed nation. Although more than half of GDP is generated through the service sector, 45% of Bangladeshis are employed in the agriculture sector, with rice as the single-most-important product. Bangladesh’s growth was resilient during the 2008-09 global financial crisis and recession. Garment exports, totaling $12.3 billion in FY09 and remittances from overseas Bangladeshis totaling $9.7 billion in FY09 accounted for almost 25% of GDP.
3.6. An overview of Economy of our Country
SMEs contribution to national economy
Segments SMEs contribution to national economy
Industrial employment 38%
Industrial units 42%
Higher growth for micro and small enterprises 6%
Medium enterprise 2%
SME Policy Strategies -2010
Small and Medium Enterprises (SMEs) have historically been one staples of the enterprise landscape within economies globally. Especially growth with clear benefits for poverty reduction puts a premium on integrating, productively and profitably, small and medium enterprises in the very process of economic growth. The over-riding vision must be for setting up a market-based economic order with a level playing field for all enterprises, in which SMEs can aspire to opportunities of growth and wealth-creation commensurate with their own endowments and diligence, innovation and management commitment.
4.2 Policy of the Government
The Government is committed to SMEs as vehicles for quality of life improvement, economic growth and poverty alleviation of the common people. The primary role of the government shall, firstly, be that of a facilitator removing policy obstacles and neutralizing market failures and, secondly, that of providing necessary promotional support.
4.3 Objectives of the SME Policy
The broad objectives of the policy shall be to:
1. Accept SMEs as an indispensable player in growth acceleration and poverty reduction, worthy of its great potential and commitment in the requisite overall policy formulation and execution.
2. The SME Policy Strategies shall be embedded, in a broad-based and integrated manner, in the Government’s PRSP.
3. Encourage and induce private sector development and promote the growth of FDI, develop a code of ethics and establish good governance, ICT based knowledge managements and customer supremacy in the markets.
4. Identify and establish an appropriate physical and ICT network of infrastructure and institutional delivery mechanism that facilitate the promotion of SMEs.
5. Re-orient the existing fiscal and regulatory framework and government support institutions towards facilitating achievement of the goals of SME Policy.
6. Nurture and partner civil-society institution(s) having credible management teams in terms of the delivery of needed services, leadership, initiation, counseling, mentoring and tutoring, etc.
7. Create innovative but meritocratic arrangements so that deserving and small enterprises with desired entrepreneurial track record and/or promise can be offered financial incentives within industries prescribed on some well-agreed bases.
8. Help implement dispute settlement procedures that proactively shield small enterprises especially from high legal costs and insidious harassment, if any.
9. Take measures to create avenues of mobilizing debt without collaterals to match (either using debt-guarantee schemes or mapping intellectual-property capital into pseudo-venture capital) in order to assist small enterprises in dealing with the pervasive lack of access to finance.
10. Systematically accord precedence to small versus medium enterprises, within the limitations of government’s resources.
11. Harness information & communications technologies, Internet Protocol (IP)-based infrastructure, and electronic-governance in an effort to parlay regulatory services, all kinds of useful information and mentoring inputs, with an accent on increasing the viability of SMEs in all sectors of the economy.
4.4 National Taskforce on SME Development
The Government constituted a National Taskforce on SME Development to draw up a realistic strategy for promoting rapid growth and vigorous competitiveness among SMEs in Bangladesh in the interest of accelerating the growth of the economy and reduction of poverty in the country.
4.5 SME Advisory Panel
An SME Advisory Panel shall be constituted involving experienced committed specialists and entrepreneurs of relevance to work together with the SME Cell of the Ministry of Industries (MOI). In the medium term the Advisory Panel and the SME Cell will eventually morph into SME Foundation.
4.6 SME Foundation
Over the medium term and beyond, the Government shall form an SME Foundation as a pivotal platform for the delivery of all planning, developmental, financing, awareness-raising, evaluation and advocacy services in the name of all SME development as a crucially-important element of poverty alleviation. The Foundation would strive to provision one-window delivery of all promotional and administrative facilities, including some resources needed for capacity building in appropriate industry association(s) for SMEs in the country.
4.7 Booster Sectors
For promotional support the following 11 booster sectors have been identified and the list will be reviewed every three years:
1. Electronics and electrical.
3. Light engineering and metal-working.
4. Agro-processing /agri-business/ plantation agriculture/ specialist farming/tissue-culture.
5. Leather-making and leather goods.
6. Knitwear and ready-made garments.
7. Plastics and other synthetics.
8. Healthcare &diagnostics.
9. Educational services.
11. Designer, aesthetically-challenging, personal wear and effects.
4.8 setting criteria for deserving enterprise
Small and medium enterprises which, as well as meeting the size requirement shall have-
(i) Proven credentials as an entrepreneur (for example, membership’ in
well-recognized social occupational groupings, successful track record) with requisite presence and facilities on the ground.
(ii)An above-average insiders’ equity participation.
(iii)Certifiable professional specialization of top-management in relevant production skills.
(iv) The stamp of approval from globally-recognized quality-assurance bodies.
(v)High management commitment to innovation. Women entrepreneurs will be accorded preference, wherever appropriate. And other things being equal, smaller enterprises shall be given preference in terms of benefits from interventions by the government and civil society initiatives.
4.9 Revenue and financial Incentives
The industrial enterprises identified in the Industrial Policy-2005 as Thrust Sectors including small and medium enterprises (SMEs) will enjoy special fiscal and financial incentives.
4.10 Credit-distribution Package and venture capital market
a. A credit-distribution package shall be worked out by the Ministry of Industries. An innovative scheme—rather like a two-stage screening mechanism—that can really probe for the bone fide of the applicants as entrepreneur material will be deployed.
b. Donor financial resources made available specifically to help with implementation of SME policy being enunciated here would only be allocated to competitively-selected enterprises within the booster industries here being prescribed.
c. Of the total resources available, no more then 20% may be earmarked for medium enterprises, while the remainder, 80%, will be earmarked for small enterprises. Within each division, the resources will be divided up into a public-sector venture-capital fund (10%), approximately on the lines of the currently-implemented EEF at the Bangladesh Bank. The remainder will be allocated to a credit fund.
d. In the short run, the distribution of the credit fund and venture-capital fund will be the task of the BASIC Bank, and BRAC Bank, which is being recommended as the lead banks. BASIC and BRAC Bank will work closely with the Advisory Panel.
e. The Ministry of Industries and the SME Advisory panel/Foundation, as the case may be, will determine modalities of how to implement both the credit-fund and the venture-capital fund.
f. Within the preview of the Advisory Panel, projects to be funded from the venture-capital fund will be evaluated by a team of experts that which will be constituted as a part of the implementation of SME Policy.
g. A publicly-mandated venture-capital scheme is created. It will also give a stimulus to the morale of entrepreneurs who commit in-house capital to projects with novel and potentially innovative processes and technologies with demonstrable potential for commercial success. Such products have a-typical high risk and high returns.
h. The Advisory Panel working together with designated Lead Bank(s) in the short-term, and the SME Foundation in the medium- and long-term would implement a transparent and meritocratic arrangement for steering public equity and debt resources into a genuinely deserving selection of enterprises.
i. The development of human resources in both the Lead Bank(s) and the SME Foundation with regard to effective targeting of resources made available under public equity funding would remain imperative.
4.11 Quality-assurance (QA) Certification
a. Bangladesh Standards and Testing Institute (BSTI) with its accountability to SMEs fundamentally enhanced through appropriate SME representation in its governance, and with appropriate representation from civil society institution(s), shall become the focal point for offering assistance with regards to securing quality-assurance (QA) certification from registrars of QA.
b. Suitable SME-related industry association shall be empowered to issue non-mandatory certification, albeit with high professional integrity, with regard to quality assurance. Such association would be eligible to grants from Government towards the cost of setting up required testing laboratories and other facilities. Such association would be eligible to grants from Government towards the cost of setting up testing laboratories.
c. Small, out-right co-financing grants will be available for registration with globally branded QA registrars.
4.12. Multi-stage Sample Survey of SMEs
There is an urgent need for a major overhaul of the availability of reliable and current data about the characteristics of SMEs. The Ministry of Industries shall immediately take up the conception and implementation of a multi-stage sample survey of SMEs in the metros and the district headquarters. Ideally, there should be a complete enumeration of all SMEs, the data from which should be of use in drawing up a survey methodology for a systematic stratified random sampling.
4.13. Tactical Plan of Action
a. Strategic Plan of Action:
The tactical plan shall be prepared to move from gap analyses to skills upgrading based on the product(s) in the booster-sectors, paying careful attention to the requirements of the production clusters in the inner cities.
b. Enabling environment:
An enabling environment in which both extant and aspiring entrepreneurs find within an easy reach most of what they direly need—information, counseling, mentoring, access to finance, technology and the means to markets.
c. SME Web Portal:
An online-community, availing of relevant information and communications technologies, of both extant and aspiring SME entrepreneurs, shall be hosted on a SME Web portal in the SME Cell/SME Foundation, for the divining of technology, product and market trends, for career-counseling to benefit science/technology graduates, for technopreneurial problem-solving session(s), for mentoring using guru disciple symbiosis.
d. Towards a virtual SME front-office:
A Web-based virtual front-office providing all start-up assistance to SME entrepreneurs (application forms, FAQs, limited directory-assistance, success stories, horror stories, etc)and an one-stop-service, with all interactions between the user and the system stored on databases shall be established in the interest of providing institutional memory.
e. Exports-friendly content on the SME Portal:
Information regarding standards of labor and output pertaining to overseas markets to benefit export-oriented SMEs should be put in place on the Web portal.
f. Electronic-governance with a human touch:
The electronics-governance shall be supplemented, at least for a time, by human touch, with adequate budget to match, to physically attend to the needs of small entrepreneurs who take recourse to them. This is based on the recognition that a totally hands-off delivery of all requisite services to SMEs is an ideal whose achievement was likely to only happen in stages.
g. High-performance communications backbone:
A high-performance fiber-optics communications backbone shall be put in place in six of the country’s largest metro-markets (namely, Dhaka, Chittagong, Rajshahi, Khulna, Sylhet and Barishal) so that the launch of some serious ICT-centric applications to benefit e-governance to the profit of SME development is not unduly handicapped by woefully inadequate bandwidth.
i. International technology-exchange programs:
Technology-exchange programs between countries in similar stages of development, and with a similar maturity of the infrastructural development for SME development, shall be implemented in the interest of rapid technology transfer.
4.15 Formulation of a package of capacity-building and training
a. Specialized professional expertise: Specialized professional expertise in carefully-chosen niches that the SME Advisory Panel recommends has potential for a broad-based replication. Such training can be so packaged to such high standards that the recipients feel motivated to pay up user charges, however minimal.
b. Re-skilling boot camps: Re-skilling boot camps would need to be organized for each of the booster industries by rotation, with a view to provide periodic technology grounding in efficacious skills among workers in SMEs.
c. Institutional capacity for training: Bangladesh Small and Cottage Industries Corporation (BSCIC)/Small and Cottage Industries Training Institute (SCITI), Bangladesh Institute of Management (BIM), Bangladesh Industrial Technical Assistance Center (BITAC) and National Productivity Organization (NPO)— where a lot of equipment, infrastructure and other resources are in place—should undergo a significant strategic reorientation of their own core competencies under the watchful eye of the Advisory Panel/SME Cell. In particular, the skills and competencies needed to enable SME hold their own in the booster-industries in the changed global business environment should be re-emphasized in the ensuing revamping of these institutions.
d. Capacity for coordination among multiple institutions: Several public institutions (such as The Atomic Energy Commission (AEC), Bangladesh Council of Scientific Investigation & Research (BCSIR), Leather Technology Institute (LTI), the Textile Colleges, the Ceramics Research Institute, the public universities, etc) have significant capacity for both product- and process-innovation of real value for SME development. The case for harnessing all that productive capacity in a coherent and harmonious manner cannot be over-emphasized. However, achieving this will require a great deal of institutional coordination among various Ministries of the government.
e. Technical assistance and investment: Towards this end, technical assistance and investment are both urgently needed to appropriately accent the training and motivational environment in these institutions so that they can become durable fixtures of technical and managerial skills, in a format of public-private partnership.
f. Private-public collaboration: The selection of such training courses and then the delivery of such training is an important instance of public-private collaboration, and shall be utilized properly and effectively.
g. R & D with potentially high-impact profiles: R & D that lead to prototypes with a scope for replication in potentially high-impact product niches (eg in the field of mobile games, 3-D animation, or bio-optics, or the manufacture of computer-controlled industrial and medical appliances, or spurring the use of resin in new production applications, etc.)
h. Curriculum development for vocational training: Curriculum of vocational training institutes shall be revised and reviewed to make it SME development friendly.
4.16. Evolving of an SME eco-system
Two kinds of institutions are recommended, preferably for adoption by civil society role models/catalysts, bearing in mind that these institutions will not be in the employ of the government.
a. The mission of the first kind is in trying to render stakeholders out of indigenous young science and technology graduates by bringing to their agenda for poverty alleviation the currently-missing fulcrum of technological innovations to improve the quality of life of the poor in Bangladesh.
b. The mission of the second is to achieve mastery over a rapidly-changing slate of IT skills, and to then quickly disseminate them among young self-starters, including in the university/polytechnic/colleges’ stream, through a regime of online and “brick-and-mortar” interactions.
c. Efforts to accelerate the retention and promotion of women entrepreneurs should be strengthened.
d. Greater stakeholder involvement in the entire gamut of activities by way of SME development while maximizing the extent of ownership shall be promoted.
4.17 Mitigating Impediments in clusters
There shall be an effort to identify three or four promising lines of production in a handful of clusters in the metros of Dhaka and Chittagong, where small enterprises abound. Gap analyses that lead to the diagnoses of weaknesses that stymie their productivity shall be launched. Several technical assistance studies shall then be aimed at these problems.
4.18 educational and generational ethoses
a. Bangladesh should increase the number, and enhance the quality of technical education in, the country’s polytechnic institutes in the interest of increasing the number of entrepreneurs.
b. Similarly, the accent on mathematics, science and technology fare should be made stronger in the educational curricula of schools and colleges in Bangladesh.
c. A census of all small and medium enterprises in Bangladesh shall be conducted.
d. The legal and contractual framework prevailing in Bangladesh often increases especially small enterprises’ handicaps. A survey of SMEs shall be launched in order to identify these insidious legal irritants.
These should then be systematically weaned from the world of Bangladeshi SMEs. e. A small-claims court needs to be instituted, with requisite resources and mandate to match.
In the feature, credit principles include guidelines of providing credit by branch manager or credit officer. In the Sonali Bank limited, Local office Branch, they follow the following guidelines while giving loans and advances to the client.
1 Credit advancement shall focus on the development and enhancement of customer relationship.
2 All credit extension must comply with the requirements of Banking company’s Act, Bangladesh Bank’s instructions, other rules and regulation as amended from time to time
3 Loans and advances shall normally be financed from customer’s deposit and not out of temporary funds from other banks.
4 The bank shall provide suitable credit services for the markets in which it operates.
5 It should be to those customers who can make best use of them.
6 The conduct and administration of the loan portfolio should contribute with in defined risk limitation for achievement of profitable growth and superior return of bank capital
7 Interest rate of various lending categories will depend on the level of risk and types of security offered.
5.2 Types of Loans and Advances
Credit many be classified with reference to elements of time, nature of financing and provision base.
(a)Classification on the basis of elements of time:
On the basis of elements of time, bank credit may be classified into three heads.
5.2.1 Continuous loans
These are the advances having no fixed repayment schedule but have a date at which it is renewable on satisfactory performance of the clients. Continuous loan mainly includes “Cash credit both Hypothecation and Pledge” and “Overdraft”.
5.2.2 Demand loan
In opening letter of credit (L/C), the clients have to provide the L/C amount in foreign exchange to the bank. To purchase this foreign exchange, bank extends demand loan to the clients at stipulated margin. No specific repayment date is fixed. However, as soon as the L/C documents arrive, the bank requests the clients to adjust their loan and to retire the L/C documents. Demand loans mainly include “Payment against Documents,” “Loan against imported merchandise (LIM)” and “Letter of Trust Receipt”.
5.2.3 Term loans
These are the advances made by the with a fixed repayment schedule. Term loans mainly include “Consumer credit scheme”, “Rural Credit Development Loan”, “Short Loan Project”, and “Staff Loan”. The term loans are defined as follows:
1 Short-term loan: Up to 12 months.
2 Medium term: More than 12 months & up to 36 months
3 Long-term loan: More than 36 month.
B) Classification on characteristics of financing:
• Letter of Credit
• Bank Guarantee
• Consumer Credit
• Cash Credit (pledge & Hypo)
• Staff Loan
• Term Loan
The varieties used by Sonali Bank limited are briefly described below with the common terms and condition. Banks generally offer different kinds of credit facilities to the customers.
The credit facilities of Sonali Bank limited may be broadly classified into five categories. They are as follows:
2 Cash Credit (Pledge, Hypothecation)
3 Overdraft (FDR, DPS, SDPS)
4 Bills purchased and discounted
5 Short Term Loan (General, Consumer)
6 Rural Credit Development Loan
7 Project Loan
8 Working Capital Loan
9 General House Building Loan (General, Staff)
10 Staff Loan
11 Industrial Credit
They are discussed accordingly:
In case of loan the banker advances a lump sum for a certain period at an agreed rate of interest. The entire amount is paid on an occasion either in cash or by crediting in his/her current account, which she can draw at any time.
Cash credit is a credit facility offered by a bank against security of goods plus collateral immovable property. Collateral security is taken because it helps the bank to minimize its risk at the same time it allows the party to avail a higher limit from the goods he puts as security. The security also helps the party to enhance (extend) the limit in future. Depending on charging security there are two forms of Cash credit
1. Cash Credit (hypothecation)
2. Cash Credit (pledge)
Cash Credit (pledge)
It is a short term arrangement by which a customer is allowed to borrow money up to a certain limit sanctioned by the bank for a certain time. Under the condition the borrower is required to submit the stock fortnightly a period of one year.
Cash Credit (hypothecation)
It is also a continuous loan allowed against pledge of goods as primary securities fall under this head of advance. To avail cash credit (hypo) facility in Sonali Bank the prospective has to mortgage goods. The goods are not delivered to bank they are just showed to respective banker. Here some extra security is also taken from the party.
Overdrafts are an arrangement where a borrower is allowed to withdraw over and above his credit balance in current account up to an agreed limit. The borrower can draw and repay any number of times, provided that the total amount overdrawn must not exceed the agreed limit.
Bills purchased and discounted
Purchase and Discount of Bills is also a special form of advances. Sonali Bank normally purchase demand bills of exchange that are called “Drafts” accompanied by documents of title of to goods such as Bill of Lading. Railway of Truck receipt. The purchase of bill of exchange drawn at a issuance, i.e. for a certain period maturing on a future date and not payable on demand or sight is termed as discounting a bill and the charge recovered by Bank for this is called Discount.
Source: Sonali Bank Website
Staff Loan (5% max service period)
Bank provides advances to the staffs. It is called staff Loan. Bank provides this advance facility under installment basis. Bank official from senior officer and above is risible for this loan. The maximum amount disbursed is Tk 2, 00,000/- for a period of 3 years. The rate of interest is 11% per annum.
House Building Loan
Sonali Bank Provides long term advances for building residential house. Advances for construction of residential houses against real estates as primary securities as allowed by banks up to Tk 5.00 lac per party (including cost of land) minus any loan taken from HBFC for these purpose. The rate of interest for ‘House Building Loans is 16% per annum and maximum repayment period is 12 years. In such cases, parties have to pay down payment of 30% of the total amount and rest of the amount should be repaid within 2 years.
Contribution in SME Sector
5.1 SME Loan Scheme
Small and Medium Enterprise (SME) Loan Scheme has been introduced to provide financial assistance to new or experienced entrepreneurs to invest in small and medium scale industries with a comparatively low rate of interest as the same is assisted by the Bangladesh Bank with refinancing facilities. Exposure under this scheme experienced significant growth of 44.39% and amounting to BDT 148.71 corer at 2011 end from that of BDT 157.32 corer at the end of 2010.
5.1.1. Agricultural/Rural Credit
With the aim to augment agricultural output, create employment opportunities and generate income of the rural people. SBL intensified its efforts to extend credit facilities to all sections of rural population under various rural credit schemes, programs and projects pertaining to agricultural and off-farming activities. Total outstanding position of agricultural credit at the end of 2011 stood at Tk 27, 81.58 crore.
5.1.2. Project Loan
Land and building are taken as security in the form of mortgage and plant and machinery are taken in the form of hypothecation.
5.1.3. Working Capital Loan
Sonali Bank Ltd. plays a vital role in the national economy by extending various credit facilities to both public and private sector organizations and entities.
In the year 2011, the bank disbursed loans amounting to Tk33, 2.06 crore under general advance, out of which Tk 356.00 corer in the public sector and Tk 463.00 core in the private sector. Interest Rate: 11%, time 1 year.
Source: Web site, Sonali Bank Limited.
5.2. Objective Basis of Classification
In classifying the loans and advance there are four classes in the loan review practices in Sonali Bank Ltd. They are:
The loan account is performing satisfactorily in the terms of its installments and no overdue is occurred. These types of loans and advances are fall into this class.
This classification contains where irregularities have been occurred but such irregularities are
temporarily in nature to fall in this class the loans and Advances has to fulfill the following factors.
Category of credit Time overdue
Demand Loan Un-recovered for 3 months and above but less than 6 months from the date of the loan is claimed.
Repayable within 5 years-It is the overdue installment equals or exceeds the amount repayable within 6 months.
Repayable within 5 years-It is the overdue installment equals or exceeds the amount repayable within 12 months.
This classification contains where doubt exists on the full recovery of the loans and advance along with a loss is anticipated but can not be a quantifiable at this stage. Moreover if the state of the loan accounts falls under the following criterion can be declared as doubtful loans and advance.
5.3. Modes of Charging Securities
There are different modes of charging security is exercised by the bank.
Pledge is the bailment of the goods as security for payment of a debt or performance of a promise. A pledge may be in respect of goods including stocks and share as well as documents of title to goods such as railway receipt, bills of lading, dock warrants etc. duly endorsed in banks favor.
In case of hypothecation the possession and the ownership of the goods both rest the borrower. The borrower to the banker creates an equitable change on the security. The borrower does this by executing a document known as Agreement of Hypothecation in favor of the lending bank.
Lien is the right of the banker to retain the goods of the borrower until the loan is repaid. The banker’s lien is general lien. A banker can retain all securities in his possession till all claims against the concern person are satisfied.
According to section (58) of the Transfer property Act, 1882 mortgage is the “transfer of an interest in specific immovable property for the purpose of securing the payment of money advances or to be advanced by way of loan, existing or future deft or the performance of an engagement which may give rise to a pecuniary liability.” In this case the mortgagor does not transfer the ownership of the specific immovable property to the mortgages, only transfer some of his rights as an owner. The banker exercises the equitable mortgage.
5.4. Bank Guarantee
As service to their customers, bankers sometimes issue guarantees of various types on customers on behalf to third parties. When a customer approaches for bank guarantee he has to fill up an application form. The Branch sends guarantee proposal to Head Office proposing a margin. Head Office after carefully study of proposal & up-to-date credit report of borrower sanctions the issue of guarantee. Head office may increase the margin of guarantee. Sometimes in case of credit worthy borrowers who need the bank guarantee urgently the branch issue guarantee first & then sought the permission of Head office. The Branch also issues counter guarantee.
Different types of guarantees issued by banks
1 Tender Guarantee or Bid Bond
2 Performance Guarantee
3 Investment Bank Guarantee
4 Customer and Exercise Guarantee
5 Deferred Bank Guarantee
The guarantees given by the request of the customer are however, specific Guarantee.
5.5. Precautionary measure
At the time of considering a proposal for issuing bank guarantee banker should always consider the following points:
? The Customer must be a man of character and integrity and be credit worthy.
? .The guarantee must relate to the normal business of the customer.
? Clauses of guarantee must be precise, clean and complete.
? The guarantee must be for a certain fixed amount and the period of its validity must be limited and fixed.
? The terms of guarantee are always covered by the terms of guarantee.
? There must be specific time limit for the enforcement of claim against the bank.
Expiry of Guarantee:
The guarantee is considered expired in the following two situations:
? The guarantor has received no claim on or before the expiry date or within the last date for claim.
? The claim arising under the guarantee has been settled to the satisfaction of all concerned.
? Nevertheless a tender guarantee or bid bond expires under the following three conditions:
1. When the tender or bid bond has been accepted by the beneficiary and the principal has signed the contract.
2. When the contract to which it relates has been awarded to another tendered.
3. When the beneficiary expressly declares that he does not intend to place a contract.
Termination of Guarantee
A guarantee becomes terminated in any of the following causes:
• Death of the principal debtor
• Death of guarantor
• Change in the constitution of the borrower.
• Change in the creditors constitution
• Demand by creditor
• Notice by guarantor
Claim of guarantee
Claim under a guarantee or indemnity should be made in writing within the validity period and must be supported with the documents which prove that the principal has failed to fulfill his contractual obligation.
Return of Guarantee Bond
As soon as the guarantee period is over, the signed guarantee bond should be called back duly cancelled by the beneficiary. The beneficiary must return the original document of guarantee to the bank when it is no more valid according to the terms and conditions under which it was issued.
5.6. Credit Information Bureau
Bangladesh bank has established within itself a Credit Information Bureau (CIB) which collects credit information from the banks. Banks are required to furnish such information in respect of credit limit of TK 50000 and over. They mention the name of facility, security and charge along with outstanding balance.
5.6.1. Credit Disbursement
Having completely and accurately prepared the necessary loan documents, the loan officer ready to disburse the loan to the borrowers loan account. After disbursement, the loan needs to be monitored to ensure whether the terms and conditions of the loan fulfilled by both bank and credit or not.
5.6.2. Credit Monitoring, Supervision, and follow up
Credit monitoring implies that the checking of the pattern of the disbursed fund to ensure whether it is used for the disbursed fund to ensure whether it is used for the right purpose or not. It includes a reporting system and communication arrangement between the borrower and the lending institution and within department, appraisal, disbursement, recoveries, follow up etc.
Officer checks on the following points:
? The borrowers behavior of turnover
? The information regarding the profitability, liquidity, cash flow situation and trend in sales maintaining various ratios.
? The review classification of credit facilities starts at credit department of the branch with the Branch Manager and finally with Head office credit division.
5.7. Loan limit
OD/SDPS: Maximum 90% of SDPS balance
Cash credit (cc) Hypothecation: Margin 50%
Cash credit pledge: 70%
Industrial credit: Unlimited
Small Loan project (SLP): BDT 1 Lac
Working Capital (WC) Loan: Unlimited
General House Building Loan: BDT 1 Lac
Rural Development Loan: Dairy Poultry, Fisheries
5.8. Documents/ Forms entitled to loan section and disbursement
? Consent of the guarantor form
? Credit Information Bureau (CIB) Form
? Check list
? Details of the entrepreneur
? Details his/her assets
? Confidential Opinion Report
? Company Credit Report
The total scenario of disbursing and recovering loans and advances are very poor for the NCBs. The amount of classified loans in increasing at a high rate so does the number of defaulters. Loan monitoring and recovery systems that are prevailing presently are not sufficient copy up with the existing situation. The percentage of classified loan is 54%. Though the branch officials concerned are trying their levels, best to make the defaulters repay the loan, their attempts are go in futile. There are also some irregularities in disbursing and monitoring loans and advances.
But as a whole Sonali Banks collection of total deposit and disbursement of fund is increasing year by year.
Discretionary Power in sanctioning Cash Credit
• Managing Directors can sanctioned up to TK 25 Lac
• General Manager can sanctioned up to TK 15 Lac
• Deputy General Manager can sanctioned up to TK 10 Lac
• Assistant General Manager can sanctioned up to TK 5 Lac
• Senior Principal Officer can sanctioned up to 3 Lac
6.1. Profile of Dimla Branch
Name of the Branch : Dimla Branch, Nilphamari
Location : Dimla, Nilphamari
Date of Establishment : 19August, 1983
Telephone Numbers : 0552256229
Mobile Number : +8801755584866
Branch in-Charge : Md. Abdul Wahab (Executive Officer)
Assistant Branch in-Charge : Mijanur Rahman (Senior Officer)
6.2. Function Hierarchy of Dimla Br, Nilphamari
6.3. Human Resources in SBL Dimla Branch:
In Sonali Bank Limited Dimla Branch total number Officer and staffs are thirteen persons of which one of them are Executive Officer (Branch in-Charge), Senior Officer three persons(one of them Assistant Branch in-Charge and another two is neophytes), Officer two persons, Officer(cash) two persons, Assistant Officer Grade-II four persons , Supporting sub-stuff one person.
6.4. Dimla Branch: At a Glance (as on June30, 2012):
6.5. Who get loan?
Every loan has natural risk. Borrower selection is the important part. So Bank follows rules and regulation for borrower selection. Dimla branch has few strategies:
• Selection of Good Entrepreneur.
• Purpose of the Loan.
• Credit Spread.
• National Interest.
• Central Bank’s Order.
There are two common strategies:
• Repayment ability.
6.6. Credit Report
Branch Manager investigates overall about the borrower before the credit report. He observes the loan safety, limit, collateral etc and then takes decision the borrower is eligible for the loan. The following criteria are observed-
• Introduction of borrower.
• Type of the business.
• Living standard of the borrower.
• Condition and Experience of the entrepreneur.
• Equity in the business.
• Objective of the borrower.
• Duration of the loan.
• Source of the installment.
• Investigating in the field level.
• Character, Honesty and loyalty of the borrower.
6.6.1. The source of investigate-
• Application of the loan.
• Financial statement.
• Bank accounts observe.
• Goodwill in the market.
• Vat return.
• CIB report.
6.7. Loan and Advance Section in Dimla Branch:
Loan Type Customer Category Range Interest rate Total Amount
Consumer Credit Service Holder 30,000-2,00,000 17% 75 Luc(App)
Over Draft Business Man 50,000-3,00,000 15% 50 Luc(App)
Special Small Loan Small Business/ Entrepreneur 20,000-25,00,000 13% 40 Luc(App)
Small and Medium Enterprise Leather, Farmer, psciculture, Small Business, poultry farm etc 20,000-2,00,000 10%-13% 120 Luc (App)
6.8. Eligibility of Entrepreneur for SME Loan
• Entrepreneur must have educated and goodwill in business.
• Age not less then 18 years.
• Bangladeshi citizenship.
• Record in the previous education qualification, practical knowledge, efficiency and investment capacity.
• Preference to Women entrepreneur.
• Computer knowledge of the entrepreneur is also given priority.
• Insane, drug-addicted, bankrupt persons are not eligible.
6.9. Application Procedure
1. Application to be submitted a specific form.
2. All the papers are procured according to check list.
3. Application form along with specimen appraisal, account statement etc may be provided to the borrower in exchange of tk.100.
6.10. Interest Rate
Type of loan Interest rate
Service, Industrial and Business 13%
Booster Sector 11%
100% Export oriented Business /Industry 8%
Women entrepreneur 10%
Source: SME Finance, Sonali Bank Limited
6.11. Loan Procedure for small Enterprise
Small Enterprise Maximum Loan: Equity Minimum Time limit Maximum Time Limit Installment Procedure
sector 70:30 1 year 4 year Monthly amortization
Industrial sector 70:30 1year 5 year Monthly amortization
Industrial and Business 75:25 1 Year and 6 Months Yearly amortization
6.12. Contribution in SME by Dimla Branch
There is a great interest in small and medium enterprises (SME) as a major plank of poverty reduction in Dimla area. The bank has formulated a comprehensive policy by putting special emphasis for developing SMEs as a thrust sector for balanced and sustainable agriculture, small and cottage industry development in the economy to help deal with the challenges. Some data with a national scope that is pertinent to characterizing SMEs in Dimla area –
Description Number of Borrowers Employee Working Range in year 2011 Total Amount (Approximate)
Food and Tobacco 25 135 30,000-2,00,000 20 luc
Wood & Leather 10 76 15,000-75,000 14 luc
Fisheries 38 135 10,000-40,000 16 luc
Poultry Farm 16 90 40,000-1,00,000 10 luc
Small Business 55 140 50,000-2,00,000 30 luc
Transport 25 15 50,000-2,00,000 30 luc
Table-1 Shows the total loan disburse in Dimla area under in Small and Medium Enterprise.
Sanctioning Recovered Recoverable Outstanding
Food and Tobacco 20 Luc 12 Luc 5 Luc 5 Luc
Wood & Leather 10 4 Luc 4 Luc 6 Luc
Fisheries 38 23 Luc 10 Luc 13 Luc
Poultry Farm 16 10 Luc 5 Luc 4 Luc
Small Business 55 40 Luc 9 Luc 10 Luc
Transport 25 19 Luc 6 Luc 00
We found that the outstanding amount of credit is comparatively high. The recovered rate of is very poor.
6.13 Contribution of SMEs in the Economy:
These are reflected in the following performance /activities of this sector:
• SME sector help alleviate poverty.
• Unemployment rate decrease day by day in this area.
• Create new business opportunity.
• Increase transport facility remote area.
• This sector is the present available sector for creation jobs.
• Increase purchasing power parity.
• In Agriculture sector, a massive change by utilizing agricultural technology.
6.14. Findings and recommendation of SME and its financing
As we got some real life idea now we will try to find out where the problems actually lie. There are a lot of problems related with SMEs. It is very hard to operate and make a business profitable here.
1. Inadequate knowledge and ability to formulate proper project proposals for seeking institutional finance.
2. Collateral based lending procedures of banks and Financial Institutions that are not suitable for SMEs.
3. Complex bureaucratic procedures and corruption
4. Limited availability of information on technical and marketing aspects of SMEs
5. Inadequate and ineffective coordination among concerned government Agencies
6. Lack of a functional definition of SMEs that can characterize their unique Positions
7. Absence of proper criteria for selecting potential SME entrepreneurs by the promotional institutions
8. High risk and monitoring cost
1. To gain adequate knowledge to formulate to look institutional finance.
2. To make proper lending procedure for SMEs.
3. Try to reduce the Complex bureaucratic procedures and corruptions
4. Government and NCB are very active in this sector. There activity should be spending all over the country, properly
5. Special ministry can be made to coordinate all the SMEs
6. Try to develop proper measure for selecting potential SME entrepreneurs by the promotional institutions
7. Try to reduce risk and screening cost.
8. Youth development department should be more activate. Their fund needs to be increased and rules should be more flexible.
9. Political and social instability should be maintained
10. It should be assured t