Market access is the missing link for CMSMEs

In Bangladesh, we cannot think of a holistic economy without attending to the CMSME sector. From rural artisans to urban tech start-ups, CMSMEs are everywhere, creating jobs, generating income, and driving inclusive growth. Over the past decade, it is evident that the Bangladesh Bank, along with private commercial banks, has made significant strides in improving access to finance. This effort continues to evolve.

However, alongside this remarkable journey towards greater financial inclusion, another crucial pillar for CMSMEs remains weak: access to markets and market information.

We must accept that even the finest product, with superior utility, can fail without access to the right market. Case studies of CMSME shutdowns across different timelines show a common cause: lack of access to local and global markets, and insufficient market knowledge. These enterprises didn't collapse due to product failure, but because no one knew about them. And they didn't know where or how to reach their market.

Imagine a farmer growing organic mangoes in Rajshahi. Thanks to government initiatives and the aggressive push by private banks, he secures a low-interest agri-loan to expand his farm. But the farmer is unaware of the rising demand for organic mangoes in Dubai or how to connect with an exporter. As a result, his produce fetches lower prices in the local market, and profits fall short of covering loan repayments. Despite having a viable product, the farmer exits the market early, saddled with bad debt, all due to poor market access.

Globally, many countries have devised innovative solutions to bridge this market access gap for CMSMEs. Vietnam's national e-commerce platform voso.vn, supported by Viettel Post, allows small businesses to list their products and reach wider audiences. India's government e-marketplace (GeM) enables CMSMEs to sell directly to government buyers, doing away with middlemen and ensuring better prices. Malaysia's MATRADE helps SMEs identify overseas markets, offers export coaching, and hosts virtual trade fairs and buyer-seller events. These are not just ideas, they are functioning gateways to markets.

Bangladesh should consider establishing a national CMSME market intelligence hub, a one-stop digital platform offering real-time market trends, pricing data, consumer behaviour reports, and export-import insights. Information is vital in business; timely and relevant data empowers smarter decisions.

We can also develop a national digital platform where verified CMSMEs can showcase their products and services and connect directly with buyers, both local and international. Through the SME Foundation, district-level workshops and mobile booths could train entrepreneurs in market research, branding, digital marketing, and pricing. Educational video content should be widely accessible to improve market literacy.

In the longer term, a national MSME market development authority could be established to focus on market expansion, data collection, product certification, innovation scaling, and trade facilitation.

Like South Korea's "SME Specialisation Complexes", Bangladesh can create specialised clusters, like Bogura for agro-machinery and Khulna for handicrafts, equipped with logistics, e-commerce facilities, research and development, and market linkages. These clusters can be scaled up nationwide. A trade intelligence lab, in partnership with universities and think tanks, could provide sector-wise insights, demand forecasts, and competitor analyses, giving CMSMEs the edge they need in an increasingly competitive world.

Let us envision a Bangladesh where a village-based honey producer exports to Japan, where a young woman running a digital embroidery shop in Sylhet sells on Etsy. A Bangladesh where entrepreneurs not only grow their businesses, but also boost innovation, create jobs, and drive GDP growth.

Access to finance helped many CMSMEs stand up. Now, access to markets will help them run, grow, and lead. The sky is the limit for our SMEs.

The writer is a senior banker.