BB sets 27% loan target for CMSMEs to boost employment

In a move to foster business growth and increase employment in the Cottage, Micro, Small, and Medium Enterprises (CMSME) sector, Bangladesh Bank has introduced a new policy aimed at boosting access to finance.

The central bank has mandated that 27 percent of all loans be allocated to the CMSME sector over the next five years. This decision was unveiled at a press conference held on Monday at Bangladesh Bank’s headquarters in Motijheel. The announcement was made by Mustafizur Rahman, Executive Director of Bangladesh Bank; Noushad Mustafa, Director of the SME Department; and Habibur Rahman, Assistant Spokesperson.

The new policy provides several key provisions to support CMSMEs, including eligibility for loans of up to Tk 5 lakh for people involved in f-commerce and e-commerce under the CMSME scheme. The revised master circular also allows small traders without trade licenses to access loans, broadening the scope for informal businesses.

Additionally, the definition of women entrepreneurs has been updated. A company will now be considered woman-led if a woman holds at least 20 percent ownership and 51 percent of its workforce are women, a revision from the previous 51 percent ownership requirement.

Furthermore, banks are now required to set up dedicated departments to manage CMSME loans and to assess the associated risks, ensuring better support for the sector.

This initiative is expected to significantly contribute to job creation and the growth of small and medium enterprises across the country.