Womens Bank

MOHAMMED ISMAIL HOSSAIN

The goals of VISION 2021, joining the ranks of middle-income countries by the 50th anniversary of independence of Bangladesh, cannot be
achieved without emancipation of women. The government has given priority to women empowerment in all the development programmes.
One of such efforts is the introduction of the National Women Development Policy 2011.
A successful implementation of the policy requires economic freedom of women which, in turn, depends on more participation of women in
businesses and industries than there is at present. Entrepreneurship development of women is highly warranted. This needs counseling and
capital. A national level banking network exclusively serving women to cater to their banking needs is an imperative to achieve the goals of
Vision 2021 as well as those of the Women Development Policy.
In 2008, a well-structured study on small women entrepreneurs by Bangladesh Women Chamber of Commerce and Industry (BWCCI)
underscored the constraints in our women entrepreneurship development and came up with the suggestion for introduction of banks
exclusively for women. The study also observed that the success of such banks depended on a special and unique monitoring system of
Bangladesh Bank that is not available here in general.
The study was based on a sample of refinancing scheme of SME women entrepreneurs under the management of Bangladesh Bank
introduced in February 2007. The scheme apparently failed by the end of the year because only Tk.4 million had been disbursed against the
allocated amount of Tk.62 million.
Women entrepreneurs lacked a number of important factors like awareness of the scheme, long term business plan of the project, proper
collateral, accounts keeping of the existing concern, which contributed to the failure. Non-cooperation by traditional banks had been a reason
as well.
The BWCCI observed that as many as 35% women entrepreneurs do not have bank accounts. Improper methods of accounts keeping are a
common constraint. A nationwide banking network exclusively serving women entrepreneurs can solve most of the problems identified in the
study. The case of the billion dollar Equity and Entrepreneurship Fund (EEF) of the government introduced in 2000 (managed by
Bangladesh Bank initially and subsequently by ICB) which currently enjoys an annual allocation of Tk.200 crore, is no exception.
Proportion of women among the entrepreneurs of the scheme is less than 1% despite the fact that priority for women entrepreneurs was the
policy of the scheme. There are many such examples. Women are yet to develop banking habit. A recent MIDAS study on women
entrepreneurs in SME identified some more constraints like lack of technical support and expertise, lack of marketing skills, and detachment
from global arena, all of which are functionally dependent on institutional and financial support that an exclusively women banking network
can deliver.
A nationwide women banking network can be envisaged not only to deliver priority loans at low interests with liberal terms and conditions, but
also to extend institutional support providing advisory support for entrepreneurship and project development, IT skills, technical expertise,
accounts keeping, marketing, and global competitiveness. The bank can be involved in the form of equity financing as an option rather than
obligation of the women folk.
This article, accordingly, suggests introduction of a nationwide government sector specialised bank named Womens Bank or Woman
Entrepreneurs Bank to exclusively deal with the economic development of women as a whole, and women entrepreneurs in particular.
Unlike traditional banks it would be welfare bank for women entrepreneurs and other stakeholders.
POLICY IMPLICATION:
Introduction of the Womens Bank will remove the barriers for women entrepreneurs like access to capital/fund. Traditional sources have very
limited scope for enterprising women to meet their fixed and working capital/credit requirements to fulfill the growing demand for introduction
and smooth functioning of businesses. Not only the financial provision but also the proper use would be ensured by the bank.
Womens Bank will plan, create, help, encourage, nurture and broaden the base of women entrepreneurship. The mission is capital formation
by women entrepreneurs and the vision is an equitable and sustainable human development of the country. An implication of the bank is that
a resolute new group of women entrepreneurs will share the leading role in trade, commerce and industry. On the one hand, it is an exclusive
modern bank for women with all the features and services of a modern bank. On the other hand, the bank will act as an agent to provide all
the support to women entrepreneurs like equity participation, conducting focused training programmes, providing advisory services, making
project profiles and sensitivity analysis in a dynamic world, getting formal papers and documents of different offices, requirements of tax and
other offices.
In brief, the aim is to provide all services that women entrepreneurs consider burdensome in a male dominated society. Successful operation
of Womens Bank will help realise the dream of economic empowerment of women as spelt out in the National Women Development Policy
2011. Establishment of this bank will be a positive step forward, with all its backward and forward linkages, towards economic emancipation
of women of prosperous Bangladesh.
The writer is General Manager Ansar-VDP Unnayan Bank.