Introduction

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1.1 Introduction

BRAC Bank Limited, with institutional shareholdings by BRAC, International Finance

Corporation (IFC) and Shorecap International, started its journey in 2001 and in just 8 years
proved to country’s fastest growing bank. The Bank operates under a "double bottom line"
agenda where profit and social responsibility goes hand in hand as it strives towards a
poverty-free, enlightened Bangladesh. BRAC Bank Limited is a scheduled commercial bank
in Bangladesh. It established under the Banking Companies Act, 1991 and its operation
started on July 4, 2001 with a vision to be the market leader through to providing all sorts
support to people in term of promoting corporate and small entrepreneurs and individuals all
over the Bangladesh.

The bank consist of major divisions named 1) Corporate banking, 2) Retail banking, 3)
Treasury, 4) Small & Medium Enterprise (SME). At present the Bank operating its business
by 69 branches. BRAC Bank is the first local commercial banks that proving online banking
service to its customers from the very beginning of its starts.

BRAC Bank, for the first time among local commercial banks, starts providing loan facilities to small
and medium trading, manufacturing and service oriented enterprises all over the country

1.2 Background of the Study

This report is expected to be a good source of knowledge and understanding on various
methods of operation performed by BRAC Bank Limited, particularly in the area of Financial
Institutional Services. From the last two months of the bank’s disbursement, everything is
been tried to include in precise form. Since, the topic of my internship program was SME
banking, I have tried my level best to put greater emphasis on this, i.e, SME loan and its
recovery and reconciliation process. I have collected all the data relevant to the topic from
various sources. With two months long hard labor, I managed to put this report in a ‘shape’. I
believe my efforts haven’t gone in vein and it can make present a comprehensive picture of
topic I was working on.
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1.3 Objective

The broad objective of this project:

1 1. How BRAC BANK Ltd operates SME banking operation around the country though its
extensive network

2 2. Why Market concentration and product diversification are considered the main
strategies for expanding the SME business.

1.3.1 Specific Objective

To support the broad objectives better we have developed some specific objectives. These
are:

1. How BRAC BANK Ltd operates SME banking operation around the country
though its extensive network

• What is the Structure of SME division of BBL

• History of BRAC Bank SME

• SME Product Details

• Operation Process of SME Loan Disbursement of BBL

2. Why Market concentration and product diversification are considered the main
strategies for expanding the SME business.

• Market segmentation

• Bases for segmenting consumer market

• Target consumer

• Target market

• Differentiated marketing
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• Developing marketing mix

• SWOT Analysis

1.4 Methodology
This study has been conducted based on primary and secondary data. The information
presented about the organization was collected from secondary sources- books, articles in
newspapers and journals brochures, leaflets, annual reports of the bank and official web site
of BRAC Bank Limited while SME related information was collected through small
interviews with the Customer Relationship Officers. The data sources used in this study are
as follows-

i) Primary Data Sources:

• Interviews of Customer relationship officers (CROs)

• Direct observation by visiting SME unit office of BBL

• Desk work in different section/division

ii) Secondary Sources:

• Different statements of the bank
• Annual report of BRAC Bank Limited
• Related books and publications
• Brochures, leaflets and other publicity materials from BRAC Bank Limited
• Loan files, balance sheets and various other documents related to SME loan of BRAC
Bank Limited
• Official Website of BRAC Bank Limited.

1.5 Scope
Scope of the study is quite clear. Since Central Support, operation help desk and
reconciliation department controls the SME loan activities of the bank, studying these core
themes, Opportunities are there to learn other aspects of SME matters.

• Concept of SME and its impact in overall economy of Bangladesh.

• Entrepreneurship development situation through SME banking.
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• Importance of SME banking in context of Bangladesh.

• Pioneer’s strategy regarding SME banking.
• Small entrepreneurs of rural – urban spectrum who are enjoying the BRAC Bank
Limited loan facility without the presence of bank at rural area.

1.6 Limitations
This study has suffered from a number of barriers-

 BRAC Bank Limited is very much concern about the confidentiality of their data.
Therefore, access to BRAC Bank data is quite limited for the outsiders.
 Time was also a big constraint for my research. I have to submit a broader deal in a
shorter form of outcome.
 Interview has been used as a source of data in this study. But, due to the time constraint I
was bound to limit the number of interviews in a few.
 Because of the bindings to go on with my daily schedule, I couldn’t dedicate myself
completely for this study. So I could spend just a few hours in a whole week to collect
data for preparing this report.
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