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Lenders urged for customized products for rural enterprises

  • Published at 10:29 pm February 26th, 2020
Lenders urged for customized products for rural enterprises
Panellists pose during a seminar titled ‘Action-Farming Conference: Transforming Financial Market for Small Businesses’ at a hotel in the capital on Wednesday, February 26, 2020 Courtesy

Bankers, financial institution officials and economist and experts participated in the program

Speakers at a seminar on Wednesday urged banks and other lenders needed developing customized products for micro and small enterprises in rural areas to ensure their access to finance.

The Business Finance for the Poor in Bangladesh (BFP-B) organized the seminar titled 'Action-Farming Conference: Transforming Financial Market for Small Businesses' at the Radisson Blu Water Garden hotel in the capital.

Bankers, financial institution officials and economist and experts participated in the program.

"Banks, financial institutions, even micro-credit organizations have no well-designed loan schemes for rural enterprises, even they have very little contribution to this area," said Hasan Imam, chairman of the Bangladesh SME Corporation.

He said this was the reality now though the situation should be different. 

"For boosting the rural economy as well as the country's overall economy, all the lenders should develop customized products," he suggested.

Imam said that the SMEs contributed only 25% to the country's GDP while the percentage was more than 50% in developed countries.

Kamal S Quadir, chief executive officer of Bkash limited, said micro and small enterprises played a significant role in achieving sustainable economic growth. 

A complete technological redesign was required to develop the financing system in rural area, he added.

When talking about loan for rural people, Arefin Ali, president and managing director of Bank Asia Limited, said: "We can't give any loan who are digitally illiterate. People who are from rural area are digitally illiterate. So there is a gap. They should be trained up first to solve this problem."

State Minister for Foreign Affairs Shahriar Alam and Deputy Governor of Bangladesh Bank Ahmed Jamal were present in the program.

Jamal said: “The total number of SMEs in Bangladesh is estimated at 8 million. Bangladesh Bank has taken a number of schemes and programs to facilitate the growth of SMEs through special funding scheme and expansion of SME focused institutions.”

He also talked about the phenomenal positive changes and the positive impacts they have achieved over the past decade for small enterprises, resulting in 8% of growth in GDP this year.