Digital Acceleration of CMSMEs, Leaving no business behind, Bangladesh

1. Digital Acceleration of CMSMEs
Leaving no business behind
Anir Chowdhury
Policy Advisor, a2i
ICT Division/Cabinet Division/UNDP Bangladesh
Frontier Technology, Policy Experimentation and Regulatory Sandboxes
in Asia and the Pacific, UNDESA and UNESCAP
June 3, 2021

2. Journey of Digital Bangladesh since 2008
Civil service
capacity
development,
regulatory
reform,
PPP
Experime
ntation
ICT and
Innovation

3. CMSMEs contribute to employment for 7.8 million people directly and provide
livelihood for 31.2 million
Key Stats on MSME contribution
70-80% of non-agricultural job creation
Accounts for 40% of the manufacturing unit
56% of the MSMEs are Service Based
Every 2 out of 3 jobs in the private sector get employed
the SMEs
There are more than 7.8 million MSMEs exists
40%
10%
21%
25%
4%
SME Contribution in Bangladesh GDP 79
BN (25% contribution)
Service
Heavy Industries
Commercial Agro
SME
Misc
Source- Impact of Bangladesh’s SME landscape Report by Lightcastle
and Sheba.xyz

4. National SME Policy highlights 6 strategic factors for
the development of CMSME Sector
MSME sector is the main pillar of industrial development in National Industrial Policy 2016
Access to
Market
Access to Business
Support Services
Access to
Information
Access to
Finance
Access to Skills Access to Technology
and Innovation

5. Impact of
COVID 19 in
MSMEs
Source- Impact of Bangladesh’s SME landscape Report by
Lightcastle and Sheba.xyz
Pandemic makes the existing hurdles even more complex

6. 70% SMEs are seeking Concessional/Working
Capital loan to tackle the crisis
Source- Impact of Bangladesh’s SME landscape Report by
Lightcastle and Sheba.xyz
GoB has allocated a total of 30,000 crore BDT as stimulus package to aid the MSMEs

7. Leaving no Business Behind
CMSME Hub for Digital Acceleration
Access to Finance
Market Access & digitization of
supply chain system
One-stop shop for CMSME
Capacity/Skill Development
Digital Transformation &
Simplification of G2B Services
CMSME
Hub

8. Implementation Methodology
❑Policy experimentation for simplification and digitization of services.
❑Regulatory sandbox for aggregated portal and Unified Business ID.
❑Tiered capacity solutions to guide CMSMEs through business life cycle of
entrepreneurship.

9. BROADBAND EQUITY:
CONNECTING CITIZENS FOR DEVELOPMENT

10. • 65% of secondary and 80% of primary level students DO NOT have
affordable and reliable access to internet
• 43M Students and 1M Teachers need internet access for online or
remote learning
• COVID-19 has accelerated the use of telehealth services up to 300%
• The e-commerce market is currently worth $2bn with 2000 e-
commerce sites
• Bangladesh has more than 650,000 IT freelancers, the 2nd largest
freelancing community (~16%) in the world, making more than $200m
annually
• There are 32.3m active MFS accounts and average daily transactions
of $2.1bn. (GSMA)
Broadband has become a LIFELINE for all citizens during the hike of COVID-19
To ensure equity in accessing education, healthcare, commerce, finance and
government services broadband equity is a must

11. Key Questions
• National broadband policy is out of date, how do we update the policy?
• Digital divide exuberates other form of divide - how do we reduce digital divide?
• Access vs usage: there is a huge gap due to affordability. How do we ensure
affordability?
• Fiber optic cables gives freedom of usage limit, how do we ensure last mile
connectivity? What role PPP can play here?
• What should be regulation for spectrum licensing to influence market players?
Broadband Equity: Bangladesh to provide 100% of its citizens with high-speed
broadband connectivity at affordable cost by 2030

12. Implementation methodology
• Technology pilots to leverage different technologies and combination to reliably
cover underserved areas in a few districts
• Policy experimentation to ensure equitable broadband for all including social
obligation fund and other innovative funding schemes for one-time fixed costs
and recurring monthly charges for data
• Regulatory sandbox for innovation PPP arrangement and business model to
make broadband affordable including partnership with global initiatives

13. Thank you