ADB approves $150m for small enterprises to create jobs
DHAKA, Nov 29, 2021 (BSS) - The Asian Development Bank (ADB) and the
government of Bangladesh today signed agreements for $150 million in loan to
provide financing for cottage, micro, and small-sized enterprises (CMSEs) to
create jobs for promoting socio-economic recovery after the COVID-19
The assistance under the Supporting Post-COVID-19 Small-Scale Employment
Creation Project will rejuvenate CMSEs operated by youth, rural
entrepreneurs, returning migrant workers, particularly women, who have been
hit hard by the pandemic.
Fatima Yasmin, Secretary, Economic Relations Division (ERD), and Edimon
Ginting, Country Director, ADB, signed the agreements on behalf of Bangladesh
and ADB, respectively held at a ceremony at ERD in the capital, said an ADB
"The assistance will support government's efforts to accelerate
socioeconomic recovery from the COVID-19 pandemic," said Fatima Yasmin,
Secretary for ERD.
"This project will reinforce ADB's long-standing support to Bangladesh in
financial inclusion and address key barriers for financing CMSEs by
developing a comprehensive action plan that will tackle sector-wide
challenges, promote best practices at the banks, and expand training and
business development support to the borrowers," said Country Director Edimon
"The project will also balance the affordability and availability of loans
in addition to adopting innovative approaches so that lower loan interest
rates do not disincentivize banks' lending to CMSEs," Ginting added.
The loan to Bangladesh Bank, the nation's central bank, will be on-lent to
participating financial institutions (PFIs), which in turn will help 30,000
CMSEs operated by the beneficiaries.
The project will create at least 45,000 employment opportunities by
December 2025. It has targeted to disburse 20 percent of the funds to micro
business led by women to support their recovery as they have limited access
to finance and have severely been affected by the pandemic due to their high
concentration in retail, travel, and hospitality sectors.
ADB will provide an additional $900,000 technical assistance grant from
its Technical Assistance Special Fund for Bangladesh Bank and participating
financial institutions to help them strengthen their risk management
capacities, business process, and information systems.
The assistance will also boost their support of CMSEs by incorporating
mobile finance, value chain financing, and sustainable financing tackling