Dhaka, Bangladesh (BBN) - Small and Medium Enterprises (SMEs) have been gaining popularity across the world due to its significant role in the development context given their greater resource-use efficiency, capacity for employment generation, technological innovation, promoting inter-sectoral linkages, raising exports and developing entrepreneurial skills.
Contributions of the SMEs in some selected countries show that it has provided very significant portion of GDP and employments in their national economies.
Asian Business Review reveals that contribution of SMEs in Bangladesh is 80 per cent in enterprises, 25 per cent in GDP and 40 per cent in employment. In India, it is 97.6 per cent in enterprises, 80 per cent in GDP.
In China contribution of SMEs is 99 per cent in enterprises, 60 per cent in GDP and 92 per cent in employment while in Japan 99.7 per cent in enterprises, 69.5 per cent in GDP and 72 per cent in employment.
The SME plays a pivotal role in the economic growth and development of Bangladesh as a mega source for job creation, income generation, and development of forward and backward industrial linkages and fulfillment of local social needs.
The SME sector helps alleviate poverty, increase income level of rural people and promote agro-industrial linkage in Bangladesh. SMEs contribute towards better utilization of local resources and skills that might otherwise remain unutilized.
It is a strong medium for diversification of rural economy and for peaceful and concurrent socio-economic development of all classes of people.
Realizing the facts, the government of Bangladesh has taken a number of measures for developing the SME sector.
Bangladesh Bank (BB), the country’s central bank, has also taken various pragmatic steps for development of this sector like introducing separate SME Department, setting SME investment disbursement targets for all the scheduled banks, introducing refinance scheme, setting disbursement targets for women entrepreneurs, introducing women entrepreneur dedicated desks in all the bank branches, SME cluster development etc.
In accordance with the objective of Sharia’h and its organizational objective of equitable distribution of wealth and socio economic development of the low income community of the country, the Islami Bank Bangladesh Limited (IBBL) has given due importance and priority to the small and medium enterprises since its inception.
Welcoming the government policy and regulatory instructions, the IBBL has been working for SME development in systematic effort.
Due to the patronization of the government and the central bank of the country, SME investment is now 24 per cent of total investment of the country amongst all the banks and financial institutions, private banks are holding the second position in making SME investment which is 27 per cent to their total investment portfolio.
Currently, 0.13 million Small and Medium Entrepreneurs of the country is banking with the IBBL a 77:23 ratio of male and female entrepreneurs.
The Sharia-based private commercial bank disbursed BDT 249.81 billion during the year 2014 which is 27 per cent of the national disbursement to the SME sector.
The IBBL takes various initiatives for the development of this sector which include entrepreneurship development training, capacity building, conducting baseline survey, reaching the doors of the entrepreneurs through its wide network of 294 branches, developing patronizing various seminars, symposia, road show, SME fair and cluster development.
The leading private commercial bank being a welfare oriented bank gives utmost priority to the desires of the mass people while designing its products and programmes.
The IBBL has a wide range of SME products including women entrepreneurs’ investment scheme having flexible in terms and collateral requirements.
In recognition of its in developing SMEs of the country, the IBBL achieved 'Small Entrepreneur Friendly Bank of the Year' award from SME Foundation and the BB over the performance of the year 2013.
BBN/SSR/AD-25Feb15-12:27 am (BST)