Problems and Prospects of SME Financing in Bangladesh

Abstract

To conduct a comprehensive study on the SME sector of Bangladesh of its present state, prospects, issues and emerging challenges this “problems & Prospects of SME Financing in Bangladesh” research is carried out. The main objective of the study is to find out the SME financing’s different types of strategies & policies in Bangladesh. The SMEs are playing gradually more significant role as a mainstream of economic escalation in Bangladesh as well as all over the world. The SME usually creates the opportunities of employment at lower costs and render flexibility to the economy. The SMEs are playing an indispensable role for overall economic development. Since this sector is a manual labor intensivewith the short period of time, usually it is capable of increasing the national income as well as hasty employmentcreation by achieving the Millennium Development Goals (MDGs) as well as the abolition of extremepoverty and starvation, gender equality and women empowerment. This SME sector has played a vital role intheeconomic progress of some prosperous countries of Asia. In national economy of Bangladesh SMEs play mainly vital role by making manufacturing enterprises by providing the employment of industrial workers and contributing to the over one-third of industrial value-added to gross domestic product (GDP) and become accustomed quickly to change the market condition, create employment, help diversify economic activities, and also make a significantcontribution to the exports and trade. The economic competence and the overall performance of the SMEs are considerably depended upon the policy of environmental and specific promotional policies pursued for their benefits. Consequently, the policies and initiatives to develop the condition of SMEs and toincrease their competitiveness are a main concern of Bangladesh.