ASA Loan Products: Empowering Entrepreneurs and Small Businesses
ASA loan products designed to provide financial support to entrepreneurs and small businesses in Bangladesh. Find the right financing solution for your needs. ASA Loan Products, Entrepreneurs, Small Businesses, Financing, Financial Support, Bangladesh, Microfinance, Business Loans.
In 1971, Bangladesh emerged as an independent nation after a harrowing war that exacted a heavy toll, costing millions of lives. The country was left in a state of devastation, marked by the scars of both conflict and natural disasters. However, it was also inhabited by a significant number of young and hopeful individuals, brimming with energy and dedication to the task of rebuilding and nation-building.
The backbone of Bangladesh’s economy has traditionally been its agriculture sector, as a significant portion of its population resides in rural areas. In the aftermath of the war, the nation faced economic challenges due to political turmoil and a lack of effective governance. Frequent protests, political instability, and numerous changes in government leadership by individuals lacking experience in maintaining stability and order were significant hurdles to progress. In such tumultuous circumstances, the formulation of policies and development planning proved to be exceptionally challenging. BURO Bangladesh also is increasing their loan products in rural area.
Loan Products List
Below is an overview of ASA’s Loan Products, which are divided into two categories: Primary Loan and Special Loan.
| Serial No | DESCRIPTION | Primary Loan | Special Loan |
|---|---|---|---|
| 1 | Service charge, Declining method | 24% | 24% |
| 2 | Service charge per Tk. 1000 | Tk. 150 | Tk. 150 |
| 3 | Weekly pay-back per Tk. 1000 | … | … |
| 4 | Number of weekly installments to complete repayment | 45 | 45 |
| 5 | Loan insurance premium during every cycle disbursement | Tk. 7 per thousand for coverage of member and spouse. | Tk. 3 per thousand for coverage of member only |
| 6 | Loan insurance payment after borrower’s death | Outstanding to be Written off | Outstanding to be Written off |
| 7 | 1st repayment starts | 14 days after disbursement | 14 days and 1 month after disbursement for weekly and monthly installment system respectively |
| 8 | Grace period and holidays in each cycle (year) | 6 weeks | 6 weeks |
| 9 | Provision for advance repayment Last | 6 installments | Last 6 installments for weekly and 1 installment for monthly repayment system |
| 10 | 1st cycle loan amount | Tk. 5,000-99,000 | Tk. 1,00,000-10,00,000 |
| 11 | Amount increase in next cycle | … | … |
| 12 | 1st loan disbursement | 1 week after enrollment | 1 week after enrollment |
Descriptions
- Primary Loan: Maximum tenure of 12 months with a loan ceiling of BDT 99,000.
- Special Loan: Maximum tenure of 30 months, offering loan amounts ranging from BDT 1,00,000 to BDT 10,00,000.
- Both loan products offer flexibility in terms of repayment and do not require collateral or group guarantees.
Here is a table of the loan categories offered by ASA, based on the information you provided:
| Category | Eligible Criteria | Initial Maximum Loan SIZE | Interest Rate | Loan Term | Repayment Mode | Incremental increase of Loan SIZE |
|---|---|---|---|---|---|---|
| Primary Loan | Economically active poor to undertake or strengthen income generating activities (IGAs). | BDT 5,000-99,000 or US$ 63-1240 depending on the economic potential of area and client’s capacity as well, in special cases initial loan size can be Tk. 5,000 or lower but entrepreneurs and traders can be provided maximum BDT 99,000 or US $1240 at first loan cycle. | Maximum 24% declining | 4, 6 or 12 months based on nature of IGAs | Generally weekly or monthly for all term loan. But repayment can be made in one installment at maturity of 4 or 6 months term loan. | BDT 15,000 or US $190 (Maximum) in each loan cycle. \$ |
| \ | Special Loan \ | Informal or formal small/micro enterprises or entrepreneurs and traders to promote and scale up production, business activity and employment generation. \ | BDT 1,00,000-10,00,000 or US 1240-12658 depending on the economic potential of area and client’s capacity. | Maximum 24% declining | 12, 18, 24 or 30 months based on nature of enterprises | Weekly or monthly |
| MSME Loan | Micro, small and medium enterprises are considered as engines of growth and drivers of economic innovation worldwide. For the economy of our country, this sector has been playing a decisive role in creating jobs for the jobless which contributes to poverty alleviation process making it faster and sustainable. Small and Medium enterprises are particularly suitable for the densely populated countries like Bangladesh where SME sector can provide huge employment opportunity with much lower investment. Over the years, ASA adopted various approaches for the development of small and medium enterprises in the country. As a result a good number small borrowers by availing assistance of ASA have successfully graduated into medium entrepreneurs. At the end of 2017, ASA introduced MSME (Micro, Small and Medium Enterprise) Program with aim to specifically foster small and medium entrepreneurs in our country. This program has been designed in an exclusive manner for offering easy and fitting assistances to the people deemed potential for the cause. Until February 2019, a number of 43 ASA MSME Branches were opened in various places considered as growth centers in the country. Furthermore, a plan has been outlined for opening more MSME branches. | BDT 3,00,000-20,00,000 or US$ 3583-23888 depending on the economic potential of area and client’s capacity. | Maximum 22% declining | 6,9, 12, 18, 24, 30,36 months based on nature of enterprises | Shorterm or monthly | BDT 10,0000 – 500,000 (US$ 1194 – 5972) depending on the economic potential of area and client’s capacity. |