Operating Lease Product to boost growth of SMEs

18 Jan '08

2 min read

Chairman and CEO of Amembal & Associates, Sudhir Amembal, while speaking to reporters said that introduction of a new lease-financing product called 'Operating Lease' can be an effective way for small firms to operate businesses.

Sudhir Amembal is an IFC consultant and one of the world's prominent leasing experts. His company is a world leader in lease education, consultancy and publications.

His services have been engaged by IFC-SEDF in alliance with the Bangladesh Leasing & Finance Companies Association. During his stay in Bangladesh he will be evaluating the situation for the introduction of the product by the finance companies.

CEO added 'Operating Lease' allows the use of an asset, but does not convey rights similar to its ownership. The main feature of the new lease product lies in its less collateral obligation and will cost less than other available lease financing products.

He also said, "The operating lease product has gained popularity in most emerging markets in Latin America, Asia and African countries over the last 3 – 4 years. This finance will provide Bangladesh's airline, textile and heavy industry an opportunity to get equipments with less collateral obligation and cost."

According to him it was suitable for growing sectors like textiles, aviation, ready-made garments and transport in Bangladesh. He further noted, "Operating lease is a wonderful means to finance those SME's who often are afraid to go to a bank for seeking a loan or lack in financial strength to draw attention of the bankers.

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