EghtesadOnline: Unpaid loans of knowledge-based companies until December 21 amounted to a staggering 70.1 trillion rials ($535 million), Central Bank of Iran data shows. The development has triggered social media frenzy.
CBI data was published recently using jargon undecipherable even by most tech experts. However, when it was reported in simple terminology at the weekend by a local news website, the debt amount made banner headlines and led to hot discussions on social media platforms like Twitter.
On its website on Feb. 24 the CBI said the impaired loans to knowledge-based companies was 70.1 trillion rials ($535 million) of which 18% (13.1 trillion rials/$100 million) is bad debt.
According to the regulator, during the nine months to Dec. 21, 2018, banks lent 51.9 trillion rials ($396 million) to 626 knowledge-based firms, Financial Tribune reported.
Over the past several years “knowledge-based companies” and the so-called “knowledge-based economy” have become buzzwords for officialdom. Small wonder that politicians of every stripe jump on the knowledge-based bandwagon to get some public exposure and undeserving publicity.
It rather strange that there still is no clear definition for what is a knowledge-based company in Iran and the term is applied to startups, tech firms, auto parts makers and the likes.
Vice Presidential Office for Science and Technology says 4,229 knowledge-based companies have been registered and a list of the firms is available on its website, which includes names of startups accelerators and auto parts makers.
Firms registered as knowledge-based are eligible for tax holidays low-interest bank loans.
As reports about the outstanding debts spread, many business owners and market observers wrote on Twitter that the drawn-out process of getting loans reserved for knowledge-based companies has always been disappointing, to say the least.
Some said seeing the layers of red tape and bloated bureaucracy they simply wrote off the whole idea of registering their knowledge-based companies.
Secretary of Tehran Guild Association of Online Businesses, Shayan Shalileh apparently vexed by the CBI report said, “They should release the names of all companies that got the loans!”
Majid Kasiri, co-founder and CEO of Akhbar Rasmi newswire writes, “Which firms have received the loans? What conditions were set by the banks?”
Adel Talebi, a well-known e-business strategist, wrote he had filed a request on the “Online Transparency System” calling on authorities to publish details about the loans.
The online transparency is part of a state initiative obliging government and state agencies to respond to people’s demands for official data. However, most of such demands are rejected due to reasons called empty excuses by users.
According to the CBI, each company on average borrowed 83 billion rials ($633,590) during the nine months.
Private banks and credit institutions gave 19.8 trillion rials ($151 million) followed by private banks at 19.1 trillion rials ($145.8 million), accounting for 38% and 37% of the total lending respectively. State companies contributed 12.9 trillion rials ($98.5 million) or 25% of the total.
A large portion of the loans were made available by Bank Saderat Iran and Bank Mellat. By the end of Q3, BSI had paid 9.9 trillion rials ($75.5 million) and the share of Mellat was 8.5 trillion ($64.8 million).
In annual terms, the data show aggregate loans to knowledge-based companies reached 69.8 trillion rials during the period from Dec.21 2017 to Dec.21 2018. Privatized banks, private banks, credit institutions, and state banks paid 27.2 trillion rials, 25.2 trillion rials ($192.4 million), and 17.4 trillion rials ($132.8 million) respectively.
At the time this newspaper went to print authorities had not responded to calls from the public for details about the multi-million-dollar loans.