UK International Development Committee visits SME Centre in Dhaka
A few days ago, we had the privilege of hosting representatives of the UK government's International Development Committee (IDC). Joining us from the IDC were UK members of parliament Stephen Twigg, Richard Burden, and Lloyd Russel Moyle.
First, we highlighted the challenges that small businesses face in obtaining loans and other financial services from financial institutions. We then looked at how the Business Finance for the Poor in Bangladesh project is supporting private sector companies to develop innovative solutions that provide financial services to underserved small businesses.
One of these companies is Bangladesh SME Corporation Limited (BSCL), a Bangladeshi private sector company that has set up SME Centres to link up potential businesses without prior banking experience to formal financial institutions.
BSCL has developed a technology platform that captures required information about the businesses and presents this info in ways that help banks to make assessments and provide loans. BSCL has 30 such centres in peri-urban locations around Bangladesh.
So far, more than 2,500 MSEs have registered in the i-SME platform, and 350 loan applications have been processed through Bangladesh Commerce Bank, Bank Asia, IFC and Dhaka Bank. An equivalent of £155,000 in loans have been disbursed so far.
The i-SME platform is one of several projects that the BFP-B is co-funding in order to bring new innovations to the country's financial sector.
The IDC Committee team saw an SME Centre in Uttara in the north of Dhaka to see how the centre facilitates making micro and small businesses investment ready to obtain financing from bank and other formal financial institutions.
About the UK International Development Committee
The International Development Committee is a select committee of the House of Commons in the Parliament of the United Kingdom. The Committee examines the expenditure, administration and policy of the Department for International Development (DFID) and its associated public bodies.
The IDC monitors the policy, administration and spending of DFID and its associated public bodies and takes an interest in the policies and procedures of the multilateral agencies and non-government organisations to which DFID contributes. The Committee consists of eleven backbench Members of Parliament. The Committee's Chair is Stephen Twigg MP, Labour Member of Parliament for Liverpool, West Derby.
About the BFP-B
BFP-B aims to catalyse private sector investment in developing new prototypes and bringing to scale viable business models that serve small businesses based on understanding the challenges small businesses face in accessing and using financial services.