An overview of SME on Mercantile Bank

Abstract

With the clear mission to provide efficient banking services and to contribute socio-economic development of the country, Mercantile Bank Ltd emerged as a new commercial bank and inaugurated its operation on 2nd June, 1999. The bank stood 47 branches all over the country up to 2009. There are 30 sponsors involved in creating Mercantile Bank Limited. The sponsors of the bank have a long heritage of trade, commerce and industry. They are highly regarded for their entrepreneurial competence. The banking philosophy of Mercantile Bank Limited is not to ‘carry coal to the new castle'. The main target is to make credits available to the poor people & their activities are aimed at multifaceted growth where people from all economic strata will enjoy the benefits of better living standard, dignity of labor and self worth. Mercantile Bank Limited provide Small and Medium Enterprise (SME) loan facilities to experienced and inexperienced entrepreneurs located in the urban and sub-urban areas to encourage new and educated young entrepreneurs to undertake productive ventures, to assist them to take part in the economic activities. To achieving the profit target, Mercantile Bank Ltd. is more interested for big and corporate loans than Small and Medium Enterprise (SME) Loan. However, they keep constant persuasion with the Heads of Branches to increase exposure in Small and Medium Enterprise (SME) Loan, but they are always handicapped with shortage of manpower in the branches. Small and Medium Enterprise (SME) is a supervised credit and needs more manpower for constant follow up, monitoring and recovery. And as such, branches ask for posting of additional manpower exclusively for Small and Medium Enterprise (SME). In this situation, it is necessary to increase substantial exposure in Small and Medium Enterprise (SME), open separate desk in the branches with adequate manpower. The bank must make a positive attempt to be more outward looking in their goals and aware of what is happening. They should have to emphasize on the domestic scenario more closely and analyze any certain trends and strategies of their competitors. By this way the Bank will be able to keep on playing its important roles in our economy.