Information asymmetries impede formal financing to MSMEs in Bangladesh. Essentially, a financial institution may not understand an MSME’s business and an MSME entrepreneur may not have the requisite documentation (or other preparedness) to access a loan. Affordable credit to MSMEs is also constrained by the high cost of origination and servicing. Thus, a platform aims to reduce these information asymmetries, reduce cost and enhance efficiency of the entire lending process.
The Consortium, led by Bangladesh SME Corporation Limited, is bringing to market the iSME Platform, which combines intelligent automation with a service delivery network made up of experienced field officers. This Platform will identify borrowers with high repayment probability; act as a translator/“match-maker” between institutions & MSMEs; and provide the “last mile” service delivery network needed to ensure strong monitoring.
The fully-automated platform provides a portfolio of critical services to MSMEs. Equipped with tablets connected to the i-SME Cloud, experienced field officers will engage with MSMEs to access financial and operational data. This data is relayed to the i-SME servers where the information is automatically processed to produce organised financials, credit evaluation reports, complete loan application packets, bank account opening applications, credit memoranda and other reports as per the needs of partner Banks.
By December 2018, 8,000 MSEs will receive at least two services from i-SME platform, and 2,000 MSEs will receive loans through the platform. Over the next ten years, it is expected to impact more than 100,000 micro and small entrepreneurs.