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Thursday, 23 May 2024
UK commits $50m debt for Bangladesh MSMEs, women entrepreneurs

UK commits $50m debt for Bangladesh MSMEs, women entrepreneurs

Staff Correspondent

British International Investment (BII), the UK’s development finance institution (DFI) and impact investor, announced a loan commitment of $50 million to BRAC Bank, a leading SME bank in Bangladesh to support small- and medium enterprises and women entrepreneurs.

The loan will provide vital funding to support growth of micro-, small- and medium enterprises (MSMEs) and women-led businesses – the bedrock of Bangladesh’s economy.

Sarah Cooke, British High Commissioner to Bangladesh, said: “This investment reinforces the UK’s commitment to support inclusive and sustainable development in Bangladesh and is a great demonstration of the UK’s modern economic partnership with Bangladesh.”

“This will enable small businesses and female entrepreneurs in Bangladesh to take up more economic opportunities and create more jobs,” she added.

The loan will support up to 3,500 micro- small- and medium enterprises (MSMEs) and women-led businesses in Bangladesh via BRAC Bank’s extensive local network. It will address the finance gap for MSMEs while only 20% of the country’s total loans go to this segment, according to a press statement issued by the British High Commission in Dhaka on Tuesday.

There are around 10 million MSMEs in Bangladesh, employing roughly 80% of the population and responsible for half of the country’s industrial output.

The central bank of Bangladesh recognises the segment as indispensable for overall economic development in the country and specifically women entrepreneurs as crucial for attaining sustainable economic growth and poverty reduction.

However, access to finance has been a major challenge, with only 20% of total loans in the country going to SMEs, including female-owned enterprises, according to BRAC Bank’s data.

Half of BII's loan will be directed to MSMEs and the other half will target women entrepreneurs with an expectation to reach up to 3,500 MSMEs and women entrepreneurs in total and accelerate their business growth.

Selim RF Hussain, managing director and CEO, BRAC Bank, said, “As an MSME focused bank, ensuring easy access to credit to grassroots entrepreneurs and women business owners is a priority for BRAC Bank. BII’s commitment will help BRAC Bank expand credit facilities to MSMEs and women-led businesses enabling them to solidify businesses.”

This investment supports UN SDG 5 on Gender Equality, SDG 8 on Decent Work and Economic Growth, as well as SDG9 on Industry, Innovation and Infrastructure, said the release.

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