International Finance Corporation (IFC) is helping to preserve thousands of jobs in Bangladesh through an investment in Prime Bank Limited to support small and medium enterprises (SMEs) and companies affected by the COVID-19 pandemic.
A $35 million loan from IFC to the private commercial bank will provide critical working capital to help small businesses continue operations, reports UNB citing a press release.
SMEs comprise over 90 per cent of businesses in Bangladesh and employ over 20 per cent of the adult population.
The financing package is part of IFC's $8.0 billion global COVID-19 fast-track financing facility, aimed at helping companies stay afloat during the pandemic.
It comes under the Working Capital Solutions (WCS) programme of the COVID-19 response envelope, which provides $2.0 billion globally to emerging-market banks, enabling them to support struggling firms.
The International Development Association's Private Sector Window (IDA PSW) Blended Finance Facility is also supporting IFC's WCS programme with a first-loss guarantee of up to $215 million in eligible countries, including Bangladesh.
"This new investment from IFC will allow us to extend critical working capital, trade finance and forex liquidity to affected businesses," said Rahel Ahmed, Managing Director and CEO of Prime Bank.
"This fresh fund injection will enable us to lend a helping hand, particularly to export and import-based SMEs and other corporate clients, and thousands of suppliers and employees who depend on these businesses."
Prime Bank has been an IFC client since 2014. It is one of the leading private-sector commercial banks in Bangladesh.
"This is an unprecedented crisis that the world is facing and we need all hands on deck to navigate the public health crisis and the resulting economic challenges," said Rosy Khanna, IFC Regional Industry Director, Financial Institutions Group - Asia and Pacific.
"Small and medium enterprises are key not just in terms of overall contribution to GDP but also in terms of job creation-and the impact of the pandemic on them has to be addressed."
