Bank Asia targets 40% SME-retail loan portfolio to drive future growth

Bank Asia targets a 40 percent share of its total loan portfolio for SME and retail businesses within the next three to four years, banking on micro, small and medium enterprises (MSMEs) to drive future growth.

The bank believes the MSME sector will remain a key driver of Bangladesh’s economic growth over the next five years, fuelled by a new generation of young, technology-savvy entrepreneurs, according to a press release.

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To capitalise on the sector’s growing potential, Bank Asia has adopted a strategy centred on digital transformation, inclusive financing and entrepreneurial capacity building to make financial services faster, simpler and more accessible.

As part of its business transformation plan, Mohammad Saifudowla Shamim, senior executive vice-president and head of small business at Bank Asia PLC, said the lender would redesign its SME value proposition, simplify customer journeys, improve operational efficiency and introduce innovative financial products tailored to the evolving needs of MSMEs.

Improving access to finance for cottage, micro and small enterprises (CMSEs) remains a strategic priority, he said.

“The bank is expanding collateral-free lending for eligible businesses by adopting cash flow-based and business viability assessments instead of conventional asset-backed lending models,” Shamim said.

Leveraging its agent banking network, Bank Asia is extending financial services to entrepreneurs in rural and underserved areas to promote greater financial inclusion.

The bank is also collaborating with government agencies, international development organisations, fintech firms and e-commerce platforms to strengthen access to finance. These partnerships enable the use of alternative data for credit assessment, helping evaluate business potential, reduce lending risks and expand affordable collateral-free financing.

Shamim said Bank Asia continues to prioritise youth and women entrepreneurs through specialised financing solutions, including refinance schemes and credit guarantee facilities offered at preferential interest rates.

“Beyond financing, the bank regularly organises financial literacy programmes, banking awareness campaigns and entrepreneurship development initiatives, alongside specialised skills training for emerging sectors such as freelancing,” he said.

Looking ahead, the bank plans to introduce structured capacity-building programmes covering entrepreneurship development, business planning, basic accounting, taxation, cash flow and inventory management, risk management, digital transformation and e-commerce adoption.

According to Shamim, these initiatives are designed to equip entrepreneurs with the financial resources, knowledge and skills needed to build resilient and competitive businesses while contributing to Bangladesh’s long-term economic growth.