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Review of SME Credit-related Policies of Bangladesh Bank Areas of further improvement with a focus on Micro and Small Enterprise (mSE) Finance

Sajjad Zohir, K. A. M. Majedur Rahman
Md. Iqbal Hossain, Anika Anjum

Report Prepared for Nathan Associates (London) Limited

The overall objective of the study was to understand the stakeholder perspectives and experience of using the mE and SME policy of BB. The main objectives were: Recommending suitable unified definition of mSMEs that will contribute to the current draft SME Strategy document of the Ministry of Industry; Appraising the feasibility of developing two separate policies on mSEs and medium enterprises financing for BB, and making recommendations for further improvements of BB SME Policy.

The report is organised to assist policymakers in the fields of financing micro and small enterprises. In particular, we have the Bangladesh Bank (BB) and the Banking Division of the Ministry of Finance (MOF) in mind, both of whom would be collaborating with the Ministry of Industries (MOI) and other relevant line ministries and departments to realise broader goals of the Government to promote inclusive growth. The purposes of targeting a sector (‘enterprises’) and identifying segments within it (such as, micro and small enterprises) for preferential treatments are closely tied with definitions. In addition, there is close correspondence between the instruments used for transfer of benefits, organisational vehicles used and efficacy of targeting.

 

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