JICA Training on Fin. & Tech.

Support for SMEs

Action
Action Plan:
Plan: Facilitated
Facilitated Lending
Lending Module
Module

ALAM Md. Ashraful

Bangladesh

OSIC, OSAKA, Japan

23 June 2010
 Problem: Current Financing System
Equity Fund
GOB [MOF]

EEF BB Fund ADB Fund IDA Fund AI Fund JICA Fund

[p]

Public sector Banks Bangladesh Bank

[The Central Bank]

SCB SB PCBs NBFI Foreign Banks

SMEs
Abbreviations:
1. GOB – Government of Bangladesh
2. MOF – Ministry of Finance
3. EEF – Equity & entrepreneurship Fund Funding Mode: Government Fund
Interest rate for the Bank : Bank rate [5%]
4. BB – Bangladesh Bank Interest rate for the SMEs : Market based [16%- 22%]
Collateral & Guarantee : Yes
5.
6.
AI – Agro processing industries
SCB – State owned commercial banks
Preference : Manufacturing and service sector Legend:
7. SB – Specialized banks
SME access to finance: limited
Total to SME loan outstanding % : 19% [2009]
Government Fund
8. PCB – private commercial banks Bank’s own Fund
9. NBFI – Non banking Financial Institutions
 Objectives of new action plan
• Greater access to finance by the SMEs
– Long term
• SME development policy & promotion law
– Initiatives for a comprehensive SME development policy
– Initiatives /proposal for enactment of SME promotion law
– Medium term
• Facilitated lending module
– Introduction of Business Plan Certification System [BPCS}
– Credit Guarantee Trust for Small Enterprises
– Certified SME consultant system [Managerial & Technical
support]
– Short term
• Introduction of Business Plan Certification System [BPCS}
• Introduction of Certified SME consultant system
 Facilitated Lending Module
Government Government
of
Bangladesh SME Fund
GIC
[Credit
insurance] CGT[SE]
Bangladesh
Guarantee Bank

BPCC
Banks & FIs

SMEs
BPCC composition: Abbreviations:
GIC –General insurance Corporation[public corporation]
1. University professor [Business/ CGT[SE] – Credit Guarantee Trust small enterprise
economics/Technical] BPCC – Business Plan Certification Committee
2. Sector specialist
3. Government Representative [MOI]
4. Fund Manager’s Representative Legend:
Fund flow :
5. SME Foundation Representative Certification process :
6. Chamber of Commerce & Credit flow :
Industries Representative Guarantee flow :
7. CGT representative Support :
Stakeholders
Action Plan Implementation Sequence