Al Arafah Islami Bank PLC intensifies its banking approaches to become a trusted partner of Micro, Small, and Medium Enterprises (MSMEs) as the bank firmly believes that today's entrepreneurs will shape Bangladesh's economic future.
"Empowering MSMEs is not simply about providing finance-it is about creating opportunities, generating employment, and building a stronger economy. And we're committed to being a trusted partner in that journey," Managing Director of the shariah-based bank Mohd. Rafat Ullah Khan said in an interview with The Financial Express (FE) ahead of The World MSMEs Day to be observed here on June 27, 2026.
What makes the sector particularly important is its ability to create opportunities across all segments of society. From rural entrepreneurs and small manufacturers to service providers and technology startups, MSMEs are helping people transform ideas into productive economic activities, he said.
"In many cases, today's large businesses started as small enterprises. Therefore, when we invest in MSMEs, we are not only supporting current businesses-we are investing in Bangladesh's future industrial base," he said.
Regarding the evolving profile of MSME entrepreneurs in Bangladesh compared to a decade ago, the seasoned banker said the change is quite remarkable. Ten years ago, most MSME entrepreneurs were concentrated in traditional trading and manufacturing activities. Today, we are witnessing a new generation of entrepreneurs who are more educated, technology-oriented, and innovation-driven.
Many young entrepreneurs are building businesses through digital platforms, social commerce, e-commerce, logistics, light manufacturing, and technology-enabled services. Women entrepreneurs are also participating in larger numbers and entering sectors that were previously less accessible to them, he said.
"This evolution requires financial institutions to rethink how they serve entrepreneurs. Banking solutions must become faster, more flexible, and more aligned with the realities of modern business," top executive of the unconventional bank opined.
In terms of the bank's current role in supporting this evolving MSME ecosystem here, he said, the bank views MSME financing as a strategic investment in the country's economic future.
Currently, the bank's CMSME portfolio stands around Tk 110 billion (approximately BDT 10,963 crore), serving more than 9,357 entrepreneurs across various sectors. "Our objective is not merely to expand financing volumes; we want to help entrepreneurs build sustainable and resilient businesses," he shared.
To better address diverse business needs, he informed that the bank has introduced dedicated financing products such as Tijara, NISA, At-Tawfiq, and Al-Awana. These products provide both collateral-free and collateral-backed financing options for entrepreneurs at different stages of business development.
"Our focus remains on making financing more accessible, inclusive, and responsive to real business requirements," he said.
About the financial inclusion to ensure that no entrepreneur in rural areas is left behind, the experienced banker said financial inclusion is central to their mission. They strongly believe that an entrepreneur's potential should never be limited by geography. Through the bank's branch network, sub-branches, agent banking operations, and field-level engagement, they have been working to reach entrepreneurs in rural and underserved areas.
In addition, he said, the Al-Arafah Rural Development Program (ARDP) plays a significant role in extending financial services to low-income individuals, micro-entrepreneurs, and rural households. The program helps people engage in income-generating activities and gradually integrate into the formal financial system. By supporting agriculture, rural enterprises, and small traders, the bank is contributing to local economic development while expanding financial inclusion across the country.
About the women entrepreneurship to Bangladesh's future growth, Mr. Khan said, women entrepreneurship is no longer a social development issue alone; it is an economic imperative. Bangladesh cannot fully realise its economic potential without greater participation of women in business and enterprise development.
He said the economy is already seeing women entrepreneurs succeeding in manufacturing, services, agriculture, retail, and technology sectors. At present, the bank's women entrepreneurship portfolio stands at approximately Tk 2.0 billion, supporting nearly 900 women entrepreneurs nationwide.
To address their specific financing needs, he said, they have introduced dedicated products such as NISA and Al-Awana. However, financing alone is not enough. Women entrepreneurs also need market access, business knowledge, networking opportunities, and supportive ecosystems to scale their businesses.
In respect to entrepreneurial capacity building, the bank's top executive said it is extremely important. Access to finance is only one part of the equation. Long-term business success also depends on knowledge, planning, financial discipline, and management capability. This is why the bank gives considerable emphasis on entrepreneur development initiatives. "Through our business network and awareness programs, we provide guidance on financial management, business planning, and banking services," he said.
The bank also actively participates in entrepreneur development initiatives under the Skills for Industry Competitiveness and Innovation Program (SICIP), which helps entrepreneurs enhance their managerial, financial, and operational capabilities. An informed entrepreneur is generally a stronger and more sustainable entrepreneur, according to him.
On digital transformation activities to meet evolving MSMEs banking needs, he said digital transformation is reshaping every aspect of banking. Entrepreneurs nowadays expect speed, convenience, and transparency. They want to apply for financing more efficiently, access banking services remotely, and receive quicker responses.
"We are progressively digitising processes related to application handling, documentation, customer on-boarding, and service delivery. Technology enables better decision-making, faster turnaround times, and improved customer experiences," he said.
Looking ahead, Mr. Khan said, data-driven assessments and digital banking solutions will play an increasingly important role in expanding financial access while maintaining prudent risk management.
About sustainability in MSMEs financing, he said sustainability is becoming an essential business consideration, regardless of size. Today's customers, investors, and supply chains increasingly value responsible business practices. MSMEs that embrace energy efficiency, resource optimization, and environmentally responsible operations will be better positioned for long-term competitiveness.
"We encourage our clients to adopt sustainable business practices because environmental responsibility and business resilience often go hand in hand.In the coming years, sustainability will become an important factor in determining business success," he said.
When his attention was drawn on key policy priorities needed to unlock the full potential of Bangladesh's MSME sector, he said a collaborative approach is essential. Areas such as credit guarantee schemes, refinancing facilities, alternative credit assessment mechanisms, digital infrastructure, market access, and entrepreneurship development require continued attention.
Many promising entrepreneurs still face challenges related to collateral requirements, market connectivity, and access to technology. Addressing these issues will require coordinated efforts from the government, Bangladesh Bank, financial institutions, business associations, and development partners, he said.
"A strong MSME ecosystem cannot be built by any single institution alone," the seasoned banker informed.
Regarding the bank's vision for the future of MSMEs in Bangladesh, the bank's managing director expressed his firm optimism over the future of the major employment-generating sector.
Over the next five years, he expects that Bangladesh's MSME sector to become more formalized, more technology-enabled, and more integrated into national and global value chains. The entrepreneurs who are starting small businesses today will become tomorrow's industrial leaders, exporters, and job creators.
"Our responsibility is to ensure they have access to the financing, knowledge, and opportunities needed to succeed. Bangladesh's future industrial leaders will emerge from today's MSMEs. At Al-Arafah Islami Bank, we are committed to supporting that journey through inclusive, Shariah-based, and sustainable financial solutions that help entrepreneurs grow, create jobs, and contribute to the nation's prosperity," he added.
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