Microcredit in Bangladesh

Microcredit programs in Bangladesh is implemented by NGOs, Grameen Bank, state-owned

commercial banks, private commercial banks and specialized programs of some ministries of
Bangladesh government. In the microfinance sector as of June, 2013, total loan outstanding is
around BDT 341 billion (including Grameen Bank BDT 84 billion), savings BDT 226 billion, the
total clients is 33 million (including 8.04 million clients from Grameen Bank) that accelerates
overall economic development process of the country. Credit services of this sector can be
categorized into six broad groups: i) general microcredit for small-scale self employment based
activities, ii) microenterprise loans, iii) loans for ultra poor, iv) agricultural loans, v) seasonal
loans, and vi) loans for disaster management. Loan amounts up to BDT 50,000 are generally
considered as microcredit; loans above this amount are considered as microenterprise loans.

In Bangladesh there are mainly four types of institutions involved in micro-finance activities.
These are 1) Grameen Bank (GB), a member owned specialized institution, 2) around 1500 Non-
Governmental Organizations (NGO) like BRAC, Proshika, ASA, BURO-Tangail, BEES, CODEC, SUS,
TMSS, Action- Aid etc. 3) Commercial and Specialized banks like Bangladesh Krishi Bank (BKB),
Rajshahi Krishi Unnayan Bank (RAKUB) and 4) Government sponsored micro finance projects/
Programs like BRDB, Swanirvar Bangladesh, RD-12 and others which are run through several
ministries viz., Ministry of Women & Children Affairs, Ministry of Youth & Sports, Ministry of
Social Welfare etc. All the programs are targeted at the functionally landless rural poor. All the
MFIs provide mostly small, un-collateralized one-year term loans to individuals belonging to
jointly liable peer groups, and they use similar on-site loan disbursement and weekly collection
methods by forming village organizations or centers.