Published: 12:50 AM, 05 August 2026
77% CMSME entrepreneurs can't access bank loans: SME Foundation
Around 77% of Bangladesh's 11.7 million cottage, micro, small and medium enterprise (CMSME) entrepreneurs remain outside the scope of formal loan facilities despite the sector contributing nearly 30% to the country's economy, according to the SME Foundation. The findings were shared on Monday at a seminar titled "Facilitating SME Financing through Digital Payment Systems and Digital Loan Processing", jointly organised by the SME Foundation and The Asia Foundation at a hotel in Dhaka.
According to the SME Foundation, only 9% of CMSME entrepreneurs currently receive direct bank loans, while another 14% access financing through microfinance institutions. The remaining 77% still have no access to formal credit.
Speakers at the seminar stressed that expanding digital loan processing and simplifying financing procedures are essential to bringing more SMEs under formal financial services.
Speaking at the event, SME Foundation Managing Director Anwar Hossain Chowdhury said Bangladesh's SME sector needs greater adoption of technology-driven production, digital business operations, innovative financial services and skilled human resources to become more competitive. "Government policies are placing increasing emphasis on creating an entrepreneur-friendly environment, boosting investment, modernising industries and expanding the use of technology," he added.
The foundation also noted that women entrepreneurs, startups and small businesses often struggle to obtain financing due to inadequate collateral, limited credit history, insufficient documentation and complex banking procedures, preventing many promising businesses from expanding.
To address these challenges, the SME Foundation and The Asia Foundation are implementing a project to expand SME financing and promote fintech-based financial services, the release added.
The foundation said the initiative is exploring the use of artificial intelligence-based alternative credit scoring, strengthening technology-driven financing and creating a more inclusive, data-driven financing ecosystem for small entrepreneurs.
According to the Bangladesh Bureau of Statistics' Economic Census 2024, about 99% of the country's 11.7 million industrial establishments fall under the CMSME category. At present, Bangladesh has more than 1.7 million CMSME entrepreneurs, only 9 per cent have access to formal bank loans, while another 14 per cent receive financing through microfinance institutions.
The seminar was chaired by SME Foundation managing director Anwar Hossain Chowdhury and Bangladesh Bank deputy governor Md Kabir Ahmed, SME Foundation board member Khalid Mahmud Khan, and Asia Foundation BSEA programme team leader Sara L Taylor were present.
SME Foundation managing director Anwar Hossain Chowdhury said that technology-driven production, digital business management, innovative financing and skilled human resources are essential to make Bangladesh’s CMSME sector more competitive, supported by government policies promoting investment, industrial modernisation and technology adoption.
Women, new and small entrepreneurs often struggle to secure financing due to a lack of collateral, limited credit history, inadequate documentation and complex banking procedures, preventing many promising businesses from reaching their full potential, he added.
To address these challenges, the SME Foundation and The Asia Foundation are implementing a project to expand financing opportunities for CMSME entrepreneurs through FinTech-based financial services.
The initiative explores AI-powered alternative credit scoring, strengthens digital financing systems and promotes a more inclusive and accessible credit ecosystem.
According to the 2024 Economic Survey, around 99 per cent of the country’s 1.7 million industrial enterprises are CMSMEs, employing about 85 per cent of the industrial workforce, or more than 30 million people.
Bangladesh Bank Deputy Governor Md Kabir Ahmed, SME Foundation board member Khalid Mahmud Khan and The Asia Foundation's BSEA Programme Team Leader Sara L Taylor attended the seminar, among others.
