The Asian Development Bank (ADB) has approved USD 150 million in loans to Bangladesh to finance the cottage, micro, and small-sized enterprises (CMSEs) operated by youth, returning migrant workers, and rural entrepreneurs, particularly women, who have been hit hard by the COVID 19 pandemic. The loan will be distributed among 30,000 such enterprises by the participating banks in Bangladesh. The project will facilitate employment creation and help the vulnerable groups to recover from the impact of COVID 19 pandemic.

The ADB in a press release said that unemployment among the youth remains high in Bangladesh and they have been severely affected by the pandemic as they worked in sectors such as retail trade, accommodation and food services. More than 40,000 migrant workers have returned since the start of the pandemic from overseas. Many of them remain unemployed. Rural incomes have stayed depressed and nonfarm employment opportunities continue to be limited.

ADB Principal Financial Sector Specialist for South Asia Dongdong Zhang said that promoting access to finance will help vulnerable groups in the immediate term and develop CMSEs in the long term. Considering the fact that women have limited access to finance, 20 percent of the funds will be disbursed for microbusinesses led by women to support their recovery.

ADB will provide an additional USD 9 lakh technical assistance grant from its Technical Assistance Special Fund for Bangladesh Bank and PFIs to help them strengthen their risk management capacities, business process, and information systems.

This loan comes on top of USD 250 million policy-based programme for strengthening social resilience in June 2021 and USD 50 million additional financing to the ongoing microenterprise development project approved in December 2020 (SAM)