At a round table discussion hosted by the Bangladesh Institute of Bank Management (BIBM), experts called on banks to play a more proactive role in financing social businesses to help address the country’s pressing social challenges.
The discussion, titled “Role of Banks in Financing Social Business in Bangladesh”, brought together researchers, bank representatives, and development partners. The paper presented at the event highlighted the growing relevance of social business as an alternative model that balances profitability with social impact, especially in low-income economies like Bangladesh.
Dr. Prashanta Kumar Banerjee, Professor at BIBM and the lead researcher, said that social businesses offer a unique opportunity to tackle poverty, unemployment, and lack of access to healthcare, education, and clean energy—without relying solely on charity.
Despite the global growth of social enterprises, the study found that Bangladeshi banks have yet to embrace this sector meaningfully. Only 18% of surveyed banks have financial products tailored for social businesses. Most banks cited the lack of policy guidelines from Bangladesh Bank, absence of certified social enterprises, and a shortage of tailored financial instruments as major barriers.
The round table emphasized that banks could channel part of their Corporate Social Responsibility (CSR) funds into social business ventures instead of limiting them to one-off charity projects. Survey results showed that 58% of bankers believe CSR funds could be more impactful if used through a social business model.
The paper also presented international best practices, including financial models from the US, Europe, Japan, and India, where government policy, venture philanthropy, and blended finance approaches have been successfully used to support social businesses.
Dr. Mohammad Monirul Islam Sarker, Director at Bangladesh Bank and co-author of the paper, stressed the need for regulatory reform. “We must develop clear guidelines, refinancing facilities, and credit guarantee schemes to encourage banks to finance social businesses,” he said.
Participants also recommended the creation of a separate Social Business Fund, establishment of a new department within banks, and increased collaboration with NGOs and donor agencies. Healthcare, environment, and education were identified as priority sectors.
Grameen Group and BRAC were cited as pioneering institutions in Bangladesh’s social business landscape. The “Nobin Program” of the Grameen Trust, which supports youth entrepreneurship, was presented as a replicable model.
The researchers called for the formation of a national-level Social Business Association and urged BIBM to spearhead training and policy advocacy. They also proposed a comprehensive impact assessment of CSR-funded projects to ensure accountability and effectiveness. The roundtable concluded with a call for coordinated efforts among regulators, financial institutions, and the government to mainstream social business as a tool for inclusive growth.