Loans to Businesses Up 26%
EghtesadOnline: Banks lent 9,750 trillion rials ($62.9 billion) to businesses in the last fiscal year (March 2019-20), which was up by 2,012 trillion rials or 26% compared to the year before.
The Central Bank of Iran on Wednesday published a report on the annual performance of banks, according to which the services sector received 34% of the total -- 3,285 trillion rials.
Industries and mining sector was next taking 3,172 trillion rials. Commercial firms received 19% of the total. Agriculture and housing respectively received 8% and 7% of the loans.
As per CBI data, more than half the loans went to boost businesses’ working capital. Shortage of capital has become a major financial problem of the important services sector. According to the CBI, working capital was the purpose of 87% of loans paid to the services sector.
Nearly 13 percent of total money was lent to help businesses expand their activities last year. The need for expansion loans was higher in industrial sector, as expansion was the purpose of 17.5% of loans paid to the sector.
Lenders also gave 1,118 trillion rials to applicants wanting to start a new business. This was the purpose of 11.5% of total business loans last year. The share of startup loans was 21% in the agro sector, higher than other sectors.
CBI's report also included data on the number of applicants able to take out loans from banks. The figures showed the industries and mining sector got significantly larger amounts -- $52,352 on average.
Services companies received an average $5,300. The average for other sectors was $3,000.