Md Kamruzzaman Khan

Executive Vice President, Head of SME, LankaBangla Finance Limited

We intend to conduct every action through a digital platform in order to make financial inclusion more accessible. In this context, necessary steps have been taken to digitise CMSME loan distributions to remote locations as fast as possible. Our long-term ambition is to establish a digital bank.

Bangladesh Bank's new interest rate cap for NBFIs will stifle loan distribution for CMSMEs. Because of the nature of their businesses, CMSME's loan ticket size is quite tiny, and the supervision and monitoring costs are excessively high. As a result, by funding at 11 per cent, NBFIs will face significant challenges in expanding their CMSME loan portfolio. So, excluding CMSME loans from the interest rate cap would be a fantastic initiative.

Kamrul Mehedi

Head of Small, Microfinance and Agent Banking, The City Bank Limited

We started our journey in 2018 and are currently the fastest growing bank in financing the CMSME segment. Our current loan portfolio is TK 2,500 crore to 22,000 small entrepreneurs and we aim to reach Tk 5,000 crore by 2024 with 40,000 active cottage, micro and small entrepreneurs. We are currently increasing our geographical footprint leveraging our agent banking points in deeply rural parts of the country and set our strategic plan to increase it to 300 geographical locations by 2024.

Due to the pandemic and political conflicts, global as well as local economies are severely impacted. Inflation is too high to survive in the possible global economic recession. The most impacted businesses belong to the CMSME segment. Producing intended growth will be challenging if policy support is not ensured.

Md Shaminoor Rahman

Executive Vice President and Head of MSME and Agri Division, Bank Asia

We have already started financing through Channel Banking to the unbanked, rural and marginal cottage, micro, small and medium enterprises (CMSME) along with our regular branch distribution channel. We have introduced a digital platform in order to expedite the approval process of CMSME loans and taken initiatives to finance the start-ups to start, sustain and expand their business as well.

With special focus on women entrepreneurship development, we have introduced cluster based financing which has been playing the role of a catalyst in the growth of CMSMEs in the country.

Flexible terms on credit guarantee support may be provided by the government for the vulnerable CMSME entrepreneurs, especially women entrepreneurs.

Md Ahsan Jamil Hossain

Vice President and Head of SME, Midland Bank Limited

CMSME is a priority investment sector for us as it is one of the economy's thrust sectors. Midland Bank is continuously developing CMSMEs through financing as well as enhancing the opportunity of inclusive growth. Besides, we has taken future strategies, such as enhancing the range of business areas, proper utilisation of our network, developing  new loan products for easy financing, enhancing linkage programmes and effectively utilising the refinance scheme of Bangladesh Bank.

To develop CMSMEs, the  government has extended many credit schemes through Bangladesh Bank. If the legal procedure under Artha Rin Ain and NI Act become faster and easier, it will be more encouraging for financial institutions to finance CMSMEs on a wider scale, which will eventually contribute to the country's macroeconomic development.

M Shahidul Islam

Managing Director, Shahjalal Islami Bank Limited

Micro, small and medium enterprise (MSMEs) banking is growing very rapidly in recent years in Bangladesh. However, there are many challenging aspects to MSME banking, particularly in risk management. Shahjalal Islami Bank Limited (SJIBL) has established an Investment Risk Management-SME Division to look after the business of MSMEs independently to make investments convenient for customers and also simplified the process for quick disposal.

It has been observed that MSMEs are facing tremendous challenges in marketing their products and require a common marketing platform that will ensure minimum prices.  Furthermore, uneven competition from the corporates needs to be restricted so that financially weak entrepreneurs could survive and increase their competitiveness as well as capacity. Credit guarantee scheme coverage needs to be widened for unsecured investments in the MSME sector to minimise the risk of banks.

Syed Abdul Momen

Deputy Managing Director and Head of SME Banking, BRAC Bank 

Along with ensuring easy access to finance for CMSMEs across Bangladesh, we are also working to ensure easy market access for their products through local and global affiliations, convenient transaction solutions, increasing women engagement and developing entrepreneurship skills, and setting up agent banking and sub branches in rural areas along with digital solutions primarily focusing on urban SMEs.

The government aims to boost CMSMEs' contribution to the economy. BRAC Bank is the top financial institution which provides unsecured loans to CMSMEs and we know the lack of collateral restrains them from easy financial access. Since we are penetrating small enterprises more than larger ones, we have to allocate most of the costs to operational activities. We are in the process of minimising operational costs through the digitization of loan processing but we expect the government will be more lenient in revising the lending cap.

Md Mostaque Ahmed

Deputy Managing Director and Chief Emerging Market Officer, Dhaka Bank Limited

Dhaka Bank has been in a continuous pursuit of increasing its exposure in the cottage, micro, small and medium (CMSME) segment.

The DBL Start-up Fund (a term loan facility for new/start-up businesses) was launched to encourage and support young entrepreneurs and transform their innovative ideas into businesses.

To further ease financing for MSME clients, the following areas could be options for the government and Bangladesh Bank:

1. The definition of trading customers may be considered up to Tk 30 crore on a turnover basis and max loan limit Tk 10 crore.

2. Newly introduced credit guarantee schemes could be revised to cover partially secured loans, set the limit at Tk 1 crore, reduce fees from 1 per cent to 0.50 per cent and accommodate medium enterprise loans.

3. Renewal of stimulus loan for another year.

Md Khalid Mahmood Khan

Deputy Managing Director, Mutual Trust Bank Limited

MTB has always acted as a strong development partner of MSMEs in the country. We strongly value the importance of MSMEs for the sustainable growth of the economy. Our target is to ensure innovative, diverse, and inclusive financing throughout all our physical and virtual platforms to the MSMEs facing challenges in accessing finance.

The government is extending all possible assistance to keep MSMEs at the centre of all economic development. I would like to urge the government to review a few propositions to ensure speedy and effective growth of MSMEs in coming days:

1) Develop a common database for MSMEs.

2) Separate the tax/duty structure of MSMEs to have better competitiveness.

3) Provide an alternative to Trade licences for women engaged in F-commerce and running business operations from residential areas.

4) Bring all MSMEs under coverage of credit guarantee schemes.

Sheikh Moyeen Uddin

Additional Deputy Managing Director and Head of MSME,

EXIM Bank

MSME is an identified thrust sector for ensuring financial inclusion and sustainable growth in Bangladesh's economy. We should look at the development history of China, Japan, South Korea and even neighbouring India, where the MSME sector is used as an engine for growth. Our government has also realised the issue and declared it as a priority sector and taken several realistic measures to promote and speed up their development. There are even some challenges that need to be addressed. This includes building awareness towards certain mindsets and commitment among all stakeholders i.e. customers/entrepreneurs. Similarly, bankers, utility service providers, developers, the administration and regulators, and specific trade bodies should implement measures successfully through concerted efforts.