Bangladesh’s private sector is struggling to secure financing for growth as weak credit access, limited financial data and heavy reliance on banks continue to constrain business expansion, industry leaders said at a policy dialogue in Dhaka.
Access to finance remains the weakest pillar of Bangladesh’s business environment, according to the Bangladesh Business Index (BBX) 2024-25, scoring 40.07 out of 100 among 11 assessed areas.
Although the score improved by 12 points from the previous year, businesses said financing constraints remain a major barrier to investment.
The findings were discussed at a roundtable titled “Access to Finance in Bangladesh: Building a More Conducive Financial System for the Private Sector”, jointly organised by Policy Exchange Bangladesh and the Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI), with support from the Australian Government Department of Foreign Affairs and Trade.
Business leaders said the challenge extends beyond loan availability, as many firms—particularly small and medium enterprises—struggle with lending requirements, limited financial records and access to suitable financing products.
Beyond bank lending
Shams Zaman, country managing partner of PricewaterhouseCoopers Bangladesh, said restoring confidence in the financial system is essential to revive credit flow.
“A credible resolution process is the foundation for rebuilding confidence and extending new credit,” he said.
Zaman said Bangladesh needs long-term capital sources beyond banks and called for the Guarantee Window to become an autonomous, professionally managed institution to diversify financing options.
The discussion, moderated by M Masrur Reaz, chairman and CEO of Policy Exchange Bangladesh, brought together business leaders, bankers and financial sector representatives to discuss credit barriers, risk assessment, regulatory coordination and financial visibility.
Shams Mahmud, managing director of Shasha Denims, said businesses are still dealing with pandemic-related disruptions and political uncertainty.
“Post-pandemic and political shocks remain insufficiently addressed,” Mahmud said, adding that manufacturers are facing severe financing and cash-flow pressures due to higher gas prices.
Syed Mohammad Kamal, president of the American Chamber of Commerce in Bangladesh (AmCham), said SMEs lack the institutional access enjoyed by larger companies.
“SMEs lack the institutional access enjoyed by large firms,” Kamal said, calling for coordinated action involving the central bank, judiciary and other stakeholders.
Data gap, energy risks limit financing
Bankers said limited borrower information and weak digital systems are making credit assessment difficult.
Syed Abdul Momen, additional managing director and head of SME banking at BRAC Bank, said expanding SME finance requires a stronger digital ecosystem.
“The current largely manual model remains inefficient,” Momen said.
Andalib Mirza, head of multinational wholesale banking at HSBC Bangladesh, said limited digital data and weak financial verification are major challenges, especially for companies outside the export-oriented garment sector.
Participants also highlighted energy shortages as a constraint on industrial financing. Banks are reluctant to finance new projects without confidence in reliable power and gas supply, making progress in gas and LNG infrastructure critical for investment.
For manufacturers, production disruptions directly affect revenue and debt repayment capacity.
Participants noted that microenterprise lending has expanded through multiple channels, with relatively low non-performing loans and growing capacity to serve smaller borrowers.
Call for a broader financing system
Mohammed Nurul Amin, chairman of Bangladesh Krishi Bank, said financing policies must reflect differences among borrowers.
“Regional, gender, financial and psychological inequalities require differentiated policies tailored to borrowers’ circumstances and needs,” Amin said.
Kamran T Rahman, president of MCCI, called for stronger coordination among Bangladesh Bank, financial institutions, policymakers and businesses to improve access to finance.
The roundtable concluded that expanding private sector financing will require better borrower information, stronger credit assessment and alternative sources of long-term capital.
For businesses, the challenge is no longer only obtaining loans but building a financial system that can support investment, productivity and long-term growth, speakers said.
