Employment Bank
All things small can, if harnessed properly, lead to great achievements. This may be too optimistic an observation on the recently launched Karmashangsthan (Employment) Bank or KB, but there is no doubt this small beginning may have the seeds of something larger. The bank has already taken off to a good response from potential clients, and expansion of its operations across the country is likely to be accomplished before the current fiscal is over. The Bank has a paid up capital of Tk 100 crore, invested by the government and nationalised commercial banks. This may not sound like a lot of money, but this is a unique initiative and its feasibility would need to be ascertained before any large-scale investment is made. But it is expected that further capital would be injected into the bank as its operations expand and the performance of its loan portfolio becomes clearer.
The bank is expected to boost the government's drive to reduce unemployment, through creation of opportunities for self-employment. There are something in the region of two crore people unemployed in Bangladesh, and in the rural areas, where 75 per cent of the labour force dwell, up to 40 per cent are either unemployed or under-employed. The government cannot rectify this situation on its own, because it cannot simply go and create jobs. Such jobs are unlikely to be economically sustainable, and therefore not "real" jobs. On the other hand, providing access to capital to help unemployed men and women initiate small enterprises would be a sound way to generate employment both in urban and rural areas.
On the face of it, the KB is ideally poised to fill a major vacuum between the micro credit operations of Grameen Bank and various NGOs, and the commercial banks. But the crucial thing would be feasibility of the ventures thus financed, and the rate of loan recovery. This would require a high degree of discipline on the part of both the lender and the borrowers. In this regard, the Bank may well like to look into how micro credit organisations have managed to maintain discipline and serve their clients' needs. It is vital that this initiative is managed professionally, with constant monitoring and evaluation. Success of the KB could well open up a new avenue for the nation's creative energy.
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