Early Warning System

Regions

South Asia

Geographic location where the impacts of the investment may be experienced.

Countries

Bangladesh

Geographic location where the impacts of the investment may be experienced.

Financial Institutions

Asian Development Bank (ADB)

International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.

Project Status

Approved

Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.

Bank Risk Rating

Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."

Voting Date

Nov 17, 2021

Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.

Borrower

Government of the People's Republic of Bangladesh

A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.

Sectors

Finance
Law and Government
Technical Cooperation

The service or industry focus of the investment. A project can have several sectors.

Investment Type(s)

Advisory Services, Loan

The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.

Investment Amount (USD)

$ 150.90 million

Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.

Loan Amount (USD)

$ 150.00 million

Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.

Grant Amount (USD)

$ 0.90 million

Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.

Bank Documents

Media Documents

ADB Lends $150 Million for Small Enterprises in Bangladesh

Primary Source

Original disclosure @ ADB website

Updated in EWS Jul 4, 2024

Disclosed by Bank Jul 6, 2021

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Project Description

If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to ADB documents, the project is a financial intermediation loan for a line of credit of up to $150 million from the ordinary capital resources of the Asian Development Bank (ADB) to the Government of Bangladesh. The fund will be relent to Bangladesh Bank, the central bank, for on-lending to participating financial institutions (PFIs). The PFIs will lend the funds to micro and small enterprises started or operated by targeted vulnerable groups—unemployed youth, returning migrant workers, and rural entrepreneurs—with a focus on women entrepreneurs. The transaction technical assistance (TA) totaling $900,000 will help strengthen the institutional capacity of Bangladesh Bank and PFIs and will support the project implementation. The project is included in ADB’s Bangladesh country operations business plan, 2021–2023.1

The project’s impact is rapid recovery from coronavirus disease (COVID-19) pandemic to restore employment, income, and economic activities.2 The project will have the following outcome: adverse economic effects of COVID-19 on migrants, youth, and rural entrepreneurs mitigated. The project’s outputs are (i) financial support to enterprises started or operated by migrants, rural enterprises, and youth from the formal banking sector increased; (ii) capacity of employment- supporting institutions strengthened; and (iii) action plan for promoting formal banking sector support for cottage, micro, and small enterprises (CMSEs) developed.

The project will help enhance the productivity and skills of the workforce, and create gainful employment opportunities, all of which are priority areas in ADB's country partnership strategy, 2016-2020 for Bangladesh, and is included in the country operations business plan, 2020-2022. The project is well aligned with the operational priorities of ADB's Strategy 2030. The project will help alleviate poverty by creating employment opportunities and supporting entrepreneurship (Operational Priority 1). The project will help strengthen governance and the institutional capacity of several key institutions crucial for employment creation (Operational Priority 6) and support gender equality by incorporating gender elements by providing inclusive financing and gender-sensitive capacity-building activities (Operational Priority 2). Moreover, in line with ADB's Strategy 2030, the project will help promote private sector development. Given the severe challenge of COVID-19, the needs of the country in all these areas take on much increased urgency and the impact of ADB support is magnified.

Early Warning System Project Analysis

For a project with severe or irreversible impacts to local community and natural resources, the Early Warning System Team may conduct a thorough analysis regarding its potential impacts to human and environmental rights.

The ADB categorized the project E&S risks as 'FI-C', and stated that given the environmental categorization of the project is FI-C, the implementing agency and the PFIs are disbursing funds to CMSEs in compliance with relevant environmental requirements.

Investment Description

Here you can find a list of individual development financial institutions that finance the project.

Asian Development Bank (ADB)

Financial Intermediary

A financial intermediary is a bank or financial institution that receives funds from a development bank. A financial intermediary then lends these funds to their clients (private actors) in the form of loans, bonds, guarantees and equity shares. Financial intermediaries include insurance, pension and equity funds. The direct financial relationship is between the development bank and the financial intermediary.

Bangladesh Bank (Financial Intermediary)

Private Actors Description

A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

The implementing agency (Bangladesh Bank) has been disbursing funds among the target group through 9 PFIs.

Contact Information

This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Responsible ADB Officer	Zhang, Dongdong
Responsible ADB Department	South Asia Department
Responsible ADB Division	Public Management, Financial Sector and Trade Division, SARD
Executing Agencies	Ministry of Finance Mr. M. Khurshed Alamm Economic Relations Division (ERD), MOF Sher-e-Bangla Nagar, Dhaka_1207 Bangladesh

Executing Agency - Finance Division, Ministry of Finance:

Dr. Md. Khairuzzaman Mozumder - Additional Secretary
Phone: +880 1711566958
Email: kzamanm@finance.gov.bd
Address: Bangladesh Secretariat, Dhaka-1000, Bangladesh

Implementing Agency - Bangladesh Bank

Mr. Md. Jaker Hossain - General Manager
Phone: +880 1731509242
Email: mjaker.hossain@bb.org.bd
Address: SME & Special Programmes Department, Dhaka-1000, Bangladesh

Asian Development Bank:

Mr. Sabyasachi Mitra - Director, Public Management, Financial Sector, and Trade Division South Asia Department
Phone: +63 2 8632 5514
Email: sabymitra@adb.org

Mr. Dongdong Zhang - Mission Leader, Principal Financial Sector Specialist
Phone: +63 85512366
Email: dzhang@adb.org

ACCESS TO INFORMATION

You can submit an information request for project information at: https://www.adb.org/forms/request-information-form

ADB has a two-stage appeals process for requesters who believe that ADB has denied their request for information in violation of its Access to Information Policy. You can learn more about filing an appeal at: https://www.adb.org/site/disclosure/appeals

ACCOUNTABILITY MECHANISM OF ADB

The Accountability Mechanism is an independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an Asian Development Bank-financed project. If you submit a complaint to the Accountability Mechanism, they may investigate to assess whether the Asian Development Bank is following its own policies and procedures for preventing harm to people or the environment. You can learn more about the Accountability Mechanism and how to file a complaint at: http://www.adb.org/site/accountability-mechanism/main.