Analyzing the scope of Refinancing schemes using scenario and gender disparity analysis within pre and post Covid Bangladesh

Abstract

Many CMSME’s were drastically affected by covid 19 due to a reduced business activity and economic uncertainty. As operating expenses increased and the income of key customer segments fell, these businesses were disproportionately hit. As a result, their net profits dwindled and reducing their ability to finance their working capital and business expansion projects. This brought in a greater need for refinancing facilities that allow these businesses to avail loans at more affordable rates. Due to these circumstances, Bangladesh bank introduced stimulus packages to aid such businesses and continued providing refinancing assistance to banks, FI’s and NBFI’s. The impact of these schemes is significant upon the most vulnerable groups of society who are unable to afford these loans normally. Yet, there are key stakeholders who struggle in availing these facilities despite SME disbursements rising over the years. IDLC massively focuses on reaching out to CMSME segments through their collaboration with Bangladesh Bank. However, covid 19 also affected the capacity of such NBFI’s to expand disbursements which only raised the existing constraints they have towards providing refinancing schemes. This report will aim to provide comprehensive company and industry analysis to further analyze the trends set within the SME financing segment within Bangladesh. More focus will be placed upon examining the potential for refinancing in these circumstances while contrasting all the analysis in a post and pre covid environment. Additionally, other tools of SME refinancing will be compared against SME Refinancing to further analyze the potential economic impacts.