Objectives  

The main objectives of the scheme are as follows:

To create income generating employment opportunities through establishment of new micro industries and BMRE of existing units by providing necessary investment facilities.

To encourage establishment of micro industries in different areas of the country by potential entrepreneurs like educated unemployed youths, technically qualified and skilled /semi skilled persons.

To encourage wage-earners to utilise their hard-earned money in the country by providing additional investment needs for establishment of micro -industries.

To provide investment facilities for self -employment of the unemployed and under employed persons having education, knowledge, skill, experience and initiative to undertake micro industrial enterprises.

  Eligibility:

The eligibility criteria for the selection of the entrepreneurs under the scheme will be as under:

Engineering diploma or degree holders, or persons having diploma or certificate from any Technical /Vocational Training Institutes and willing to set-up micro industries.

Educated unemployed youths having initiative and knowledge regarding the proposed industry.

Skilled and semiskilled persons having practical knowledge and experience in industrial perations.

Persons already engaged in micro-industries as owners and willing for BMRE of their enterprises.

Wage Earners who want to establish micro industries having work experience/training in the particular field of industry.

The proposed enterprise must be exclusively owned by Bangladeshi Nationals which use indigenous raw materials or imported raw materials not exceeding 25% of the total requirement of raw materials.

Defaulters and persons/enterprises having outstanding liabilities with other Banks and Financial Institutions will not be eligible for availing investment under the scheme. 

Sectors of investment:

Different sectors including food and agriculture based industries, plastic & rubber industries, forestry and furniture industries, engineering industries, leather industries, chemical industries, textile industries, recycling industries, service industries, electrical accessories industries, computer technology industries, paper products industries, handicrafts industries, fishery & live stock farming, hollow bricks, roof tiles and any other viable micro-industries have been identified for financing under the Scheme. 

A detailed list of enterprises in each sector is given at Annexure-A. Any other item(s)/sector(s) that has not been included in the list but there is scope for investment, the Branch may approach Head Office through their respective Zonal Office for inclusion thereof.  

Purpose of Investment:

To procure capital Machinery

To purchase raw materials

To meet a portion of working capital requirement.  

While selecting enterprises(s)/project(s) for financing, Branch must ascertain the market demand of the product of such enterprise(s)/project(s). Also care should be taken so that local machineries & raw materials are used to keep cost of the project at a minimum level and to develop supporting job opportunities.  

Bank’s investment & ceiling thereof:

The extent of Bank’s investment will depend upon the actual requirement of a particular industry/enterprise, its nature of production, model & origin of machineries, the working capital requirements etc. The Branch should ascertain the cost of the project taking into account all the above issues. 

Bank’s investment shall not be more than 60% of the cost of machineries or 50% of the total cost of the project (both machinery & working capital), whichever is less, within the maximum total investment ceiling of TK.5.00 lac per project/enterprise.The client’s equity shall be calculated taking into account cash investment plus the  cost of the project land & building if owned.  

Security Requirements:

To secure Bank’s investment, collateral security of immovable properties backed by Irrevocable  General Power of Attorny shall have to be obtained.                

In case of technically qualified persons and educated unemployed youths, the original educational certificates shall have to be deposited with the Bank.

The ownership of machineries/equipments shall remain in the  name of  the Bank till full adjustment of Bank’s dues.

The stock (existing & future) shall remain hypothecated with the Bank till full adjustment of Bank’s investment.

In case of exceptionally deserving candidates, such as educated, experienced, sincere, hardworking young-men with good reputation who intend to set-up & run the industries fulfilling all the terms & conditions except that of collaterals they may be allowed an investment up to a maximum ceiling of TK.2.00 lac without collateral but on personal guarantee of 2(two) reputable persons having good financial means and social standing acceptable to the Bank.

Period of Investment:

Capital Machinery          :        5(five) years including reasonable gestation period.           

Raw Materials                :            One year from the date of 1st disbursement.  

Rate of Return & Rebate:

The Rate of Return will be @ 14% per annum in case of timely payment 1% rebate shall be allowed.

Risk Fund:

The client will contribute in the risk fund @ 2% of the total Bank’s investment for the project/enterprise at the time of disbursement in order to meet any loss caused by genuine/ and unforeseen risks & hazards.  

Mode of Investment:

Capital Machinery                    :    Hire-Purchase Shirkatul Melk (HPSM)

Raw Materials                          :    Bai- Muajjal.

Recovery of Bank’s dues:

The Mode of payment shall be determined considering the cash flow of the particular project enterprise within the investment period. The Branch in consultation with the client will determine the instalment and payment period. However, the following may be considered in fixing the mode of payment.

a.   Hire Purchase         :    In monthly/fortnightly/weekly instalment basis.

b.   Bai-Muajjal             :    In Lumpsum at the end of the tenure of Investment  

In order to encourage regular payment of Bank’s dues, Branch should encourage instalment payment in both the modes. This will reduce the risk of overdues & diversion of funds. 

Processing & appraisal of Applications:

Each geographical area has its own development potentials. The type of micro industrial project(s)/enterprise(s) most desirable for financing in a particular area to enhance productivity and income in that given area is not necessarily the same type to be found in another area.  

The project/enterprise proposed to be financed should be judged taking into account the area of the project, its financial and economic feasibility, cost & returns and cash flow as well as adequacy of Rate of Return. Accordingly, in each case the following papers should be obtained:

Application in prescribed form duly filled in and signed.

Project Appraisal Form duly filled in and signed.

Projected cash flow statement with all particulars duly signed.

Detailed Credit Report F-167B, duly filled-in and signed.

Information on the above will enable the Branch to ascertain the viability of the project and to take a decision as to the extent of to finance required and estimated time required for recovery of the same.  

After scrutiny of the above, application & other related appraisal documents, the Branches on being satisfied on all aspects of the project shall send the same to their respective Zonal Head duly recommended by them. The Zonal Heads shall examine and appraise the proposals and send the same to Head Office, duly recommended.  

Command Area

Investment under the Scheme shall be made within the 20 Km. radius from the branch.   

Sanction & Disbursement:

Project Investment Department of Head office shall scrutinise the proposal on the basis of the information furnished and the recommendation of the Branch and Zonal Office. If the proposal is found suitable in all respect for making investment, Head Office will issue Sanction Advice to the Branch. Thereafter, necessary arrangements shall be made by the Branch for disbursement, only after completion of all the required formalities including documentation as per Bank’s rules regulations and norms.  

Supervision:

Close supervision must be ensured by the branch for proper implementation of the project and recovery of installments in time. For this purpose supervisors (technical hands) shall have to be appointed for each of the designated branches. Initially at the stage of implementation, the supervisor must visit the project weekly and after implementation at least once in a month and keep the Branch Manager informed about the position of the project in detail.  

Review & Evaluation:  

Branch must ensure constant and close supervision of end-use of investment. Close monitoring of performance of the client and the enterprise is vital for the success of the Scheme.

The Concerned Branch shall have to evaluate the performance of the investment and shall send statement to Head Office through their respective Zonal Office.

The Branch Manager shall convene meeting of the investment clients under the scheme regularly and will discuss problems & prospects with them & evaluate the performance.

Head Office will conduct periodical inspection to ensure the compliance of rules and regulations, strict supervision of the projects by the Branch and timely recovery of installments strictly as per schedule.                    

Social Benefits:

The educated unemployed, technically qualified persons skilled and semi skilled persons will be socially rehabilitated and will get better employment and income generating opportunities.

Unemployment and its consequent evils will be gradually eliminated from the society.

Wage-earners will get opportunity to utilise their hard earned money in productive & profitable enterprises & can settle them-selves within the country in a peaceful environment with their family members.

Through formation of capital, Micro Industrial Enterprises will be self-operating units and will generate better and higher income for the target groups.

The quality of life of these entrepreneurs will improve and it will gradually develop the socio-economic condition of the country.  

List of Micro Industries

Food and Agriculture Industries:

Bakery & Confectionery ,Mills, Oil Mill,Flour Mill,Dal Mill, Chira Mill,Rice Mill ,Ice Factory,Farm,Beef-Fattening,Dairy (small/medium) ,Poultry,Fish Farm/Shrimp Culture,Hatchery (Shrimp and other fishes), Poultry Feed/Fish Feed ,Food Products,Lozenge, Chanachur etc.,Food Products (Jam,Jelly and other types of fruit processing /canning.).Dried Fish ,Coconut Products ,Milk Processing & Pasteurisation Plant.

Plastic & Rubber Industries:

Polythene ,Plastic & Rubber Products ,Rubber Thread ,PVC Products . 

Forestry & Furniture Industries:

Furniture,Wooden furniture ,Steel Furniture ,Cane furniture ,PVC Furniture, etc. ,Wood Work ,Saw Mill,,Nursery. 

Engineering Industries:

Engineering Workshop (Mech/Automobile Workshop, Welding etc.),Spare Parts manufacturing,Wire Nails/Wire, Netting/Nut-Bolts etc.,Filter ,Aluminium products ,Sanitary Goods

Leather Industries:

Leather Products, Footwear .

Chemical Industries:

Soap (Both Washing & toilet soap),Chemical Products ,Cosmetics Industries  

Textile Industries

Silk Yarn ,Weaving (Power Loom /Hand Loom) ,Ready-made Garments/Garment Accessories etc. ,Shoe, Lace, & Tape etc.,Hosiery ,Dyeing & Printing: ,Screen Printing ,Specialised Silk Screen,Printing ,Block Printing ,Batik Printing ,Handloom Products.

Recycling Industries:

Waste Cotton Refiner,Waste Plastic Recycling/Sponge/chappals, Plastic Toys etc.,Waste Paper and Polythene Recycling.  

Service Industries:

i. Service Shop (Radio/Two-in-One/T.V./Computer etc.) .

Electrical Accessories Industries:

Electrical Items (Fan, Bulb, Motor Parts etc.) ,Decoration Light shades. . 

Computer Technology:

Computer Training Centre, Development and assembling of Hard Ware/Soft ware technology.  

Paper Products Industries:

Printing Press ,Packaging/Board/Packing Materials etc. ,Graphic Scan, Printing Process Studio etc.,Handmade paper/Office Stationery . 

Handicrafts Industries:

Jute Handicrafts,Twisting/Rope & Twine ,Water Hyacinth Ornaments ,Pottery ,Brass Products  ,Bamboo Baskets ,Greetings Cards ,Flower Shop ,Gold smith shop ,Imetation Ornaments ,

Fishery & Live Stock Farming:

Aquaculture,Fishery & Hatchery ,Fish culture in Pond ,Poultry ,Dairy ,Beef-fatening . 

Miscellaneous:

Any other micro industry is found viable by the Bank.