Christopher Dalo

Standard Chartered Bank has decided to focus more on small and medium enterprises in Bangladesh amid growing demand for funds from its clients, said a senior official of the global banking giant.

“We have already strengthened our SME banking offerings to meet the changing needs of the fast-growing SMEs in Bangladesh,” said Christopher Dalo, global head of sales management and customer offerings (SME banking) of the Bank.

The London-based Bank has redesigned its focus on the SME banking globally as the segment has grown at almost twice the rate of GDP in most markets and is expected to grow by up to 12 percent in a year across its footprint in Asia, Africa and the Middle East.

Dalo sat with The Daily Star for an interview in Dhaka yesterday.

The official said the needs of the SMEs are changing in Bangladesh due to the expansion of their businesses.

“Earlier, the SMEs used to operate their businesses targeting only the local customers, but now they are selling products to overseas markets and importing goods,” said Dalo.

As a result, they are getting busier and their needs are changing, he added.

“We have to change our product offerings and solutions since the needs of the SMEs are changing,” said Dalo who holds a Bachelor's and a Master's degree in industrial engineering from the University of Massachusetts, USA.

In line with the changing needs of the SMEs, the Bank will offer the tailor-made services exclusively for the segment, focusing on simplicity.

“We will provide these products and solutions to the SME segment that will help them satisfy their comprehensive needs,” said Dalo

He said the small and medium businesses generally need banking support for their working capital, business expansion, business protection and yield enhancement.

The new product proposition will serve these needs, said Dalo. “Customers' needs are not just lending needs, rather they want more.”

The official said they want to expand their offers for the SMEs as Bangladesh is one of their important markets among the emerging countries.

"It is an important and growing market. It has grown tremendously. We see it to grow even more," said Dalo.

The Bank, which is especially focused on Africa, Asia and the Middle East, launched SME banking in Bangladesh in 2004.

“In the segment, we have a good track record since the beginning of the SME operations here,” he added.

In Bangladesh, there are about 60 lakh SMEs and micro-enterprises, according to Asian Development Bank, making up 75 percent of the domestic economy.

The sector accounts for about 45 percent of manufacturing value addition, 80 percent of industrial employment, 90 percent of total industrial units and 25 percent of the total labour force.

Their total contribution to export earnings ranges from 75 percent to 80 percent, according to an ADB survey.

"We do business in about 30 markets. Bangladesh is clearly among the top ten. We see here good growth," said Dalo who joined the Bank in 2010 and is now based in Singapore.

Their goal is to become the priority bank of the customers, said Dalo.

"Our ambition is to be the leading international bank for SMEs, building the segment into a multi-billion-dollar business over the next two to three years."

However, Dalo said the SME sector also carries some risks.

"Risk management is important. One of the challenges is a lack of access to financial data of many small enterprises and their business health."

The Daily Star/Bangladesh/ 12th April 2012