BRAC Bank, SME Foundation to provide collateral-free loans to shoe-manufacturers

BRAC Bank Limited and SME Foundation have signed a partnership agreement for providing SME loans to the entrepreneurs in shoe-manufacturing clusters across the country. 

Under the agreement, BRAC Bank and the SME Foundation will partner to offer working capital financing/term loan to the entrepreneurs at preferential rates. The financing arrangement is under refinancing facility of Bangladesh Bank. The entrepreneurs can avail loans ranging from BDT 1 lakh to Tk 25 lakh without any collateral. 

According to the agreement, BRAC Bank will receive BDT 12 crore from SME Foundation.  There are many leather and shoe-manufacturing clusters in the country concentrated mostly in Bhairab (Kishoreganj), Brahmanbaria, PurboMadarbari (Chattogram), Siddique Bazar, Lalbagh, Kamrangirchar, Dhanmondi (Dhaka) and Noakhali. The clusters meet a sizeable domestic demand for shoe and leather items.  

 Selim R. F. Hussain, Managing Director and CEO, BRAC Bank, and Md. Safiqul Islam, Managing Director, SME Foundation, signed the agreement at SME Foundation Office in Dhaka on January 19, 2020. Syed Abdul Momen, Head of SME Banking, BRAC Bank; and senior officials of the both organizations were also present. 

Commenting of the agreement, Selim R. F. Hussain, Managing Director and CEO, BRAC Bank, said: “As a SME-focused bank, BRAC Bank is committed to ensure access to finance to the SME entrepreneurs at the grassroots.  We have long been partner of the SME Foundation to provide SME loans to entrepreneurs in different clusters. We believe BRAC Bank will play a catalytic role in enhancing manufacturing growth and expanding the shoe clusters. BRAC Bank’s branch and strong SME Unit Office network will facilitate door-to-door services and quick loan disbursement.”

Presently, BRAC Bank and SME Foundation are providing SME loan facilities in Gobindaganj Hosiery Cluster, Gaibandha and Cricket Bat Cluster in Pirojpur and other areas.