Bangladesh: Banks can make profit from micro-credit
Speakers at a seminar in Dhaka on Monday called upon the private and state-run commercial banks to provide all assistance for the micro-finance institutes (MFIs) in credit operation to cut poverty in the country.
Commercial banks can earn huge profit from this sector as loan recovery is 95-99 per cent in micro-credit system and the poor people invest the credit in various income generating activities, they added.
The Credit and Development Forum (CDF) organised the seminar on "Loan guarantee scheme of Grameen Foundation, USA (GFUSA)" at the PIB conference room with CDF Chairman Dr Atiur Rahman in the chair.
Deputy Director of Capital Markets of GFUSA(1) Ms Regula Schegg presented the keynote paper.
The seminar said, in human terms, more than 75 per cent of the world's 560 millions poor families lack access to efficient, affordable and appropriate financial services.
Market demand for micro-finance services is estimated at more than US dollar 300 billion, while supply is only US dollar 15 billion, it added.
Dhaka Bank Managing Director Shahed Noman, NCC Bank Managing Director Nurul Amin and Bangladesh Krishi Bank Deputy Managing Director Nurul Huda Chowdhury also spoke on the occasion.
CDF Director M Abdul Awal conducted the seminar attended by senior bank officials from private and public sectors and representatives from micro-finance bodies and facilitators.
The participants of the seminar interacted on issues including social responsibility of the commercial banks, demand and supply of micro-credit, collateral and easier procedure of getting loan for the MFIs, role of the government in financing the micro-credit sector, coordinated venture of bank, micro- credit bodies and agriculture sector, and related issues.
(1) GFUSA is a Washington-based non-profit organisation that fights against poverty in 22 countries around the world through its 52 network partners in Asia, Africa, America and the Middle East, organisers said. The organisations sprang from the Grameen Bank of Bangladesh founded by Prof Muhammad Younus, who is a founding and current board member of the Foundation.
"GFUSA Growth Guarantees" is an anticipated 50 million US dollar guarantee programme dedicated to advancing poverty focused MFIs. Its aim is to raise much needed financing by accessing local capital markets to lift the people from poverty.
