IFAD extends helping hand to Bangladesh!

An additional loan assistance of $18.07 million to rebuild microenterprises and support smallholders adversely hit by the COVID-19 pandemic, The International Fund for Agricultural Development or IFAD will provide Bangladesh.

The additional financing will scale up activities under the ongoing Promoting Agricultural Commercialisation and Enterprises or PACE project which is being implemented by the government-founded Palli Karma-Sahayak Foundation or PKSF.

The funding will complement efforts of Bangladesh government and PKSF to assist microenterprises and smallholders recover from the severe effects of the pandemic on rural economy.

This additional loan will finance activities from January 2021 to December 2022 to help restore microenterprises in the farm and non-farm sectors as well as scale up and strengthen successful value chains under the PACE project.

“The impact of the pandemic is long term in nature and requires building back the economy better. The additional resource is IFAD’s response for rehabilitation of microenterprises and smallholder families who lost their businesses and income due to the COVID-19-induced constraints. The initiative will restore their livelihoods and develop strategies to reduce future risks,” said Rasha Omar, IFAD’s South Asia Hub head.

The PACE project, jointly financed by IFAD, the government and PKSF was launched in 2015 with the aim of improving profitable business opportunities for micro entrepreneurs nationwide as well as creating employment for the extreme and moderate poor people.

The PACE project has directly facilitated about 321,000 micro entrepreneurs and other actors engaged in value chains in select farm and non-farm sectors through 74 value chain and 25 technology transfer sub-projects by providing them with microcredit support, technical assistance, technological promotion as well as facilitating market access, according to a statement.

With the additional loan, the total value of the PACE project now amounts to $129.81 million with IFAD financing of $58.07 million. The project is expected to directly facilitate another 168,000 beneficiaries, including 48,000 micro entrepreneurs and 120,000 value chain actors over the next two years.

This initiative by IFAD and PKSF to restore the microfinance sector will increase the disbursement of loans to microenterprises to restore and build back better their business and agricultural activities, It will enhance their resilience to absorb the shocks that could be induced by future crises.