Palli Karma-Sahayak Foundation (PKSF) has floated a new project to boost microenterprises.
The six-year "Rural Microenterprise Transformation Project (RMTP)," jointly financed by PKSF, the International Fund for Agricultural Development (IFAD), and the Danish International Development Agency (Danida), was launched on Sunday.
The project will directly benefit 4.5 lakh microentrepreneurs across the country. It will cost $200 million, of which the IFAD will contribute $81 million, and Danida $8.30 million.
PKSF, its partner organisations, non-bank financial institutions, entrepreneurs and private sector organisations will provide the rest of the fund.
Financial Institutions Division Senior Secretary Md Ashadul Islam was the chief guest at the RMTP's online launching ceremony which was presided over by PKSF Chairman Dr Qazi Kholiquzzaman Ahmad.
While presenting the new project, PKSF Deputy Managing Director Md Fazlul Kader said value chain development, financial services, and institutional capacity development support will be provided for the promotion of agricultural products under three major farm categories – livestock and poultry, crops and horticulture, and fisheries and aquaculture.
The project will use innovative technologies to widen the scope of agricultural activities.
Apart from initiating farming activities based on internet of things (IoT) and artificial intelligence (AI), it will adopt blockchain technology to ensure more transparency in the management of financial services.
A crowdfunding platform will be launched to create opportunities for equity financing for the microenterprises, Fazlul Kader also said.
Ashadul said the development of microenterprises is crucial for the country's overall economy.
"Ensuring adequate financing for marginal producers and microentrepreneurs is a big challenge. And this project, which is in line with the government's development strategy, will help address the challenge."
Highlighting Denmark's experience in working with Bangladesh as a development partner, Danish Ambassador Winnie Estrup Petersen said supporting small farmers to increase agricultural productivity and output have positive impacts on household income growth, poverty reduction, and food security.
"The RMTP will support marginal and small farmers, farmer groups, microentrepreneurs and agribusinesses to improve their operation and develop commercially beneficial linkages within selective commodity value chains."
Also, the project will combine financial and non-financial services to create the best possible impact to enhance income and cut poverty, Winnie Estrup said.
The RMTP will strengthen the rural microenterprises sector by bringing all the actors – microentrepreneurs, input suppliers, technical services, microfinance institutions, non-banking financial institutions, agribusinesses, processors, wholesalers and retailers – together, IFAD Country Director Omer Zafar said.
Investments will focus on nutritious high-value horticulture, livestock, and aquaculture commodities while complying with food quality and safety standards.
A transactional and informational digital platform will also be developed to seamlessly link supply chain stakeholders.
The RMTP will generate multiple social, nutritional, financial, economic and institutional benefits for around 450,000 microenterprises – representing 2 million rural women, men and youth – and create productive jobs for many more, Omer added.
Qazi Kholiquzzaman said Bangladesh's economy is still a rural and agriculture-based one, and 80 percent of people are working in the informal sector.
To change the scenario, appropriate financing along with technology transfer, training, market expansion, and forward and backward linkages are required, Kholiquzzaman said.
"The rural people will not need to migrate to elsewhere for work if appropriate employment opportunities, through microenterprises, can be generated in their areas."