A Report on SME Activities of Bangladesh Development Bank Limited

Topics: Entrepreneur, Entrepreneurship, Loan Pages: 31 (4925 words) Published: April 7, 2014

CHAPTER ONE
INTRODUCTION

SME (Small & Medium Enterprise) is an Enterprise that is independently owned an operated and is not dominant in its field of operation. Most of the countries of the world defined small & medium enterprises (SMEs) depending on the size and the size is measured by annual turnover, the number of employees and the balance sheet, i.e. the value of enterprise’s assets.

According to Industrial Policy Order 2010, micro enterprises consist of those having assets worth Taka 5.0 million and/or offering employment opportunities 10 to 24 or less workers, while those, being small ones, are worth Taka 5.0 million to 100 million and/or employ 25 to 99 workers at the individual enterprise level and medium enterprises are worth Taka 100 and 300 million and/or employ 100 to 250 workers each.

Bangladesh Bank and Ministry of Industry defined SMEs in line with the Industrial policy 2010 as follows: Table

Value(replacement cost) of fixed assets excluding land and building No. of employees
Small Industry Enterprise
Manufacturing
BDT 50 lac to 10 crore
25 to 99

Service
BDT 5 lac to 1 crore
10 to 25

Trading
BDT 5 lac to 1 crore
10 to 25
Medium Industry Enterprise
Manufacturing
BDT 10 crore to 30 crore
100 to 250

Service
BDT 1 crore to 15 crore
50 to 100

Trading
BDT 1 crore to 15 crore
50 to 100
Micro Industry Enterprise
Manufacturing
BDT 5 lac to 50 lac
10 to 24 or less

Service
Less than BDT 5 lac
Less than 10

Trading
Less than BDT 5 lac
Less than 10

Brief Scenario of SMEs in Bangladesh:
With a view to achieving its millennium development goal such as eradication of extreme poverty, developing a global partnership for development etc. the government of Bangladesh has given highest preference toward the development of small and medium enterprises (SMEs) in Bangladesh. At present SMEs in Bangladesh provide its 80% employees. SMEs are in fact very back bone of the economy of Bangladesh to generate work opportunity especially for young people and female workers want to work.

Table
Growth pattern of SME in Bangladesh
Growth Pattern of SME Year
Growth Percentage of Small Enterprises
2001-02
7.69
2002-03
7.21
2003-04
7.45
2004-05
7.93
2005-06
9.21
2006-07
10.28
2007-08
11.52
2008-09
12.13
2009-10
13.68

Table
Contribution of SMEs in the GDP on Bangladesh
Numbers of workers
Total Contribution to GDP (Taka)
Percentage of Total contribution
0-1
193 996 555 714
26
2-5
379 663 897 358
51
6-10
73 120 983 681
10
11-20
45 183 240 157
6
21-50
33 960 498 076
5
51-100
15 138 922 373
2
Total
741 064 097 360
100

From 2003-04 to 2010-11 fiscal years the production index of medium and large industry: Table 4

2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
The production index of medium industry from large industry

272.13

294.72

328.35

360.33

384.82

413.42

442.12

468.28

From the table it is clear that the production index of medium and large industry is increasing every year.

Specialized Bank
Specialized Banks are foreign exchange banks, industrial banks, development banks, export-import banks catering to specific needs of those unique activists. These banks provide financial aid to industries, heavy turnkey projects and foreign trade.

Sectors of Specialized Banks in Bangladesh
The name of some specialized banks are :
Grameen Bank (GB)
Bangladesh Krishi Bank (BKB)
The Dhaka Mercantile Co-operative Bank Limited (DMCBL)
Bangladesh Development Bank Limited (BDBL)
RajshahiKrishiUnnayan Bank (RKUB)
BASIC Bank Limited (Bangladesh Small Industries and Commerce Bank Limited) Bangladesh Somobay Bank Limited (Co-operative Bank) (BSBL)
Ansar VDP Unnayan Bank (AVUB)
Out of the specialized banks, BKB and RKUB were created to meet the credit needs of the agricultural sector while BDBL is for extending term loans to the industrial...

References: 7. Bangladesh Economic Survey, 2011.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Sme Activities of Brac Bank Limited Essay
  • Research on Southeast bank limited bangladesh Essay
  • Sme Loan Of Jamuna Bank Essay
  • Access to Bank Credit to Smes Essay
  • Sme in Bangladesh Essay
  • Unilever Bangladesh Limited Report Essay
  • Sme Banking in Bangladesh Essay
  • Essay on Sme Bank Pakistan

Become a StudyMode Member

Sign Up - It's Free