Nothing is holding back the banking system from financing small and medium-sized enterprises and by the end of the current fiscal year in March 2017, all production units will have sufficient cash, said the governor of the Central Bank of Iran.

�In the current year and considering the emphasis by the Leader Seyyed Ali Ayatollah Khamenei regarding the Resistance Economy, the CBI exempted the SMEs from several factors that hinder the process of granting them loans,� Valiollah Seif was quoted as saying by the official website of the CBI.

�This effort was made so that by yearend, no production unit would have to suffer from a credit crunch,� he said during a visit to Markazi province in central Iran.

By definition, enterprises run by 100 workers or less, and 50 workers or less are considered medium- and small-sized businesses respectively, according to Iran�s Small Industries and Industrial Parks Organization.

In July, deputy minister of industries, mining and trade Ali Yazdani had said 96% of the 88,000 licensed businesses in Iran are considered small and medium.

The CBI governor said so far, �more than 90.23 trillion rials ($2.8 billion)� worth of loans have been allocated to 12,361 SMEs throughout the country, further noting that in Markazi province alone, 2.7 trillion rials ($85.2 million) was given to SMEs.

On the basis of loan allocation to SMEs, Seif said lending from banks must be used where it will lead to steady and sustainable manufacturing and job creation. He called on the provincial task forces to remove barriers to production by assisting the banking system in the proper allocation of loans and help prevent waste of resources.

The official, who has often emphasized the importance of reviving the ailing SMEs, sent a letter to the chief executives of state-owned banks in early June, asking them to treat financing SMEs as a priority. By official decree of the central bank, lenders and credit institutions were ordered to allocate a minimum of 10% of their loans to these businesses to help create jobs and lift the beleaguered production sector.

In the provincial meeting that was attended by the vice president for executive affairs Mohammad Shariatmadari, director of the National Development Fund of Iran Ahmad Doust-Hosseini and Markazi province�s governor general Mahmoud Zamani-Qomi, Seif also reflected upon CBI resources and expenses.

By Financial Tribune