The existing financial management in the country is not helpful for the development of small and medium enterprises (SMEs) though the SME is the driving force of the country's economy. SMEs account for around 70 percent of all enterprises in Bangladesh, speakers said.
They said the financial institution have to make radical reform in its monetary policy for the development of the SME sector. As a huge number of women entrepreneurs is involved in this sector, the government should provide special assistance for them.
They were speaking at a workshop on "Innovative Fund for SME Financing in Bangladesh" jointly organized by DCCI and Business Finance for the Poor in Bangladesh (BFP-B), funded by UK Aid of the UK government by at Dhaka Chamber of Commerce and Industry (DCCI) auditorium in the city yesterday.
Vice President of DCCI Kamrul Islam said there are more than 1.5 million SME entrepreneurs across the country. The SME is the driving force of our economy. Around 70 percent of all enterprises in Bangladesh are SMEs. He said limited access to finance is the biggest setback for SMEs. Innovative financing mechanism needs to be developed to enhance the SME growth of Bangladesh. Smart and innovative financing solutions against conventional financing tools could bring revolutionary change and supplement value to cement their base in macro economy.
Christopher August, Team Leader, BFP-B said, this fund has been created for the innovative SME development and poverty alleviation. The rural entrepreneurs of Bangladesh as well as SMEs are very innovative and diversified. He said the funding request must be for a specific, new and innovative business idea that will improve SMEs' access to finance in Bangladesh.
Arafat Hos-sain, Challenge Fund Manager of BFP-B said the BFP-B is a UK Aid funded project and the organization has fund titled 'Business Finance Challenge Fund' of 6 million British pound and any Bangladeshi private sector firm including bank, non-banking financial institution, micro finance institution, companies providing advisory and other services to SMEs, NGO will have access to this fund as a grant. But the end beneficiary will have to be SMEs.
He said the third round of this project is in progress and will end on June 30 this year. The project prefers women entrepreneurs and pro-poor SMEs in rural areas. 'Business Finance Challenge Fund' provides grant of up to 50 percent of the cost of innovative commercially driven project. The goal of this project as well as fund is to promote inclusive economic growth and to improve the income and livelihood opportunities for poor people in Bangladesh.
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