Karmasangsthan Bank has formulated a comprehensive five-year masterplan to create employment for nine lakh unemployed youths, aimed at poverty alleviation, increasing production, and fostering inclusive economic development.
The Managing Director Arun Kumar Chowdhury revealed the plan during an exclusive interview with BSS, at his office.
Immediate targets and funding
The bank is currently working towards bringing in between 1.25 lakh and 1.5 lakh unemployed youths under its employment scheme during the ongoing 2026-27 financial year.
To support this initiative, Bangladesh Bank has already approved a project worth Tk1,000 crore.
Arun Kumar Chowdhury stated that this funding will provide low-interest, easy-term loans to 50,000 new unemployed individuals within one year. These loans are intended to help recipients become self-reliant small-scale entrepreneurs through various small businesses.
To date, the bank has supported approximately 13.5 lakh unemployed individuals and small entrepreneurs with loans ranging from 4 per cent to 9.75 per cent interest.
Assistance for marginalised communities
In collaboration with Financial Institutions Division of the Ministry of Finance, the bank will implement a pilot project to integrate the ultra-poor, underprivileged, climate-vulnerable, and other marginal groups into the formal economy.
Under this project, collateral-free loans ranging from Tk30,000 to Tk1 lakh will be provided to fruit and vegetable vendors, tea-stall owners, and individuals involved in sewing, handicrafts, or other small-scale trades.
Beyond financial assistance, the bank will provide consultancy and support in investment management, marketing, technical, and administrative matters to ensure sustainable livelihoods.
Regional implementation and pilot projects
The initial phase of the project will distribute Tk50 crore to approximately 8,000 people through eight branches of Karmasangsthan Bank across 20 upazilas in the Sherpur, Barguna, and Kurigram districts. The interest rate for these loans is set at 6 per cent, with 3 per cent allocated to a seed fund and the remaining 3 per cent covering administrative costs.
The managing director expressed hope that successful implementation could bring revolutionary socio-economic changes, as many individuals in these categories are often driven toward criminal activities due to a lack of productive opportunities.
The bank has also initiated a programme to create “trained unemployed-free upazilas,” starting in Badarganj of Rangpur and Gauripur of Mymensingh. By creating a database of trained youth and providing planned employment, he expects these two upazilas to be declared free of trained unemployed youth within the next two to three years.
Future initiatives and operational challenges
Karmasangsthan Bank has declared the current year as the “Year of Transparent Banking and Sustainable Employment”. Future plans include:
- Expanding training for entrepreneurs in product design, production, and cost reduction.
- Introducing green financing and Shariah-based loan activities.
- Implementing mentoring and monitoring systems to ensure the sustainability of businesses and improve loan recovery rates.
However, the managing director highlighted a significant manpower shortage as the primary challenge. While the bank’s organogram calls for 3,200 employees, it currently operates with only 1,800. Many branches are run by just three to four staff members, making it difficult to simultaneously handle loan disbursement, supervision, and recovery.
Arun noted that the bank’s rural loans primarily target productive sectors, which helps reduce rural unemployment, poverty, and inflation.
He suggested that if the government granted Karmasangsthan Bank tax-exempt status, similar to Grameen Bank, it would be possible to provide sustainable employment opportunities to even more youths at even lower interest rates.
