ADB gives $100m loan to support CMSMEs

The Asian Development Bank (ADB) and the government of Bangladesh on Thursday signed a $100 million loan agreement to support cottage, micro, small, and medium-sized enterprises (CMSMEs) located outside the Dhaka and Chattogram metropolitan areas.
The ADB's assistance will facilitate access of the CMSMEs to medium and long-term credits.
Economic Relations Division (ERD) Secretary Md Shahriar Kader Siddiky and ADB Country Director Hoe Yun Jeong signed the loan agreement in Dhaka.
Under the Second Small and Medium-Sized Enterprises Development Project (Phase 2), the ADB fund would be utilised to create at least 15,000 jobs by 2030.
It will spur economic growth and poverty reduction through the development of the CMSMEs in rural areas, increase the number and size of commercially viable CMSMEs, as well as employment in the sector, ADB said a in a statement.
In addition, the project will help CMSMEs innovate by integrating climate risk into their business operations and expanding to green products, thereby increasing and capturing new markets.
"As Bangladesh strives to diversify and transition its economy, developing CMSMEs is a key to accelerating growth, and reducing poverty, income inequality, and regional disparity," said ADB Country Director Hoe Yun Jeong. "This project will help achieve these goals by supporting the CMSMEs in rural areas, especially those run by women, with better access to long-term capital".
"The project will also help women entrepreneurs develop skills to manage their enterprises more efficiently, and improve the financial institutions' technical capacity to provide credit and skills to the CMSMEs", Mr. Jeong added.
ADB will also provide $950,000 technical assistance to Bangladesh to strengthen the institutional capacity of Bangladesh Bank and participating financial institutions, and provide capacity support for the targeted CMSMEs.
It will also strengthen the capacity of the entrepreneurs, including the women-led CMSMEs, to access bank financing and financial services, develop training modules; conduct training workshops on CMSMEs; support the development of action plans on green finance and value chain-based financing; technical standards, and pilot projects.