DOI: 10.36347/sjebm.2020.v07i09.009

Pages: 341-346

Microcredit programs (MCP) in Bangladesh are implemented by various formal financial institutions (nationalized commercial banks and specialized banks), specialized government organizations and semi-formal financial institutions (nearly 700 NGO -MFIs). The growth in the MFI sector, in terms of the number of MFI as well as total membership, was phenomenal during the 1990s and continues till today. The total coverage of MCP in Bangladesh is approximately 13 million households. The coverage of major institutions in the formal and semi-formal sectors. There is debate, however, on the extent of overlap- one borrower taking loan from more than one microfinance institution. The general consensus is that a national average would be that 15% of all borrowers are borrowing from more than one MFI. In that case the effective coverage is about 11 million households. Out of 11 million households covered by MCP, about 80% are below poverty line and so about 8.8 million poor households are covered by MCP. With an estimated households of 26 million, out of which about 46% are poor households, the total number of poor households is approximately 11.96 million. Therefore, there is still scope of extending the coverage of microcredit programs to an approximate 3.16 million households. Bangladesh government has also placed adequate emphasis on microcredit programs. The Interim Poverty Reduction Strategy Paper (IPRSP) of the government of Bangladesh has outlined some important roles for microcredit. The policy makers have recognized the importance of microcredit in Bangladesh and the present government has pledged its support to this program. Recognizing the importance of microcredit in poverty alleviation, the major challenge now, the UN has declared 2005 as the UN International Year of Microcredit. With combined efforts of the governments, MFIs, donor agencies and above all the peoples of the nations through a multipronged approach poverty will be removed from the face of the earth....