Micro-credit Program of Bangladesh Krishi Bank: A Study on Socio-Economic Development Leading to Poverty Alleviation

Background: The Micro-Credit Program of Bangladesh Krishi Bank (BKB) has been instrumental in promoting socio-economic development and alleviating poverty in rural Bangladesh since 1973. Despite significant economic growth, poverty persists, especially among landless farmers and marginalized communities. BKB's initiatives aim to empower these groups through small loans to foster self-reliance. Methods: This study employed a mixed-methods approach to analyze BKB's micro-credit program's impact, focusing on beneficiaries who received loans from 1999 to 2006. A stratified sample of 708,200 individuals was analyzed using both qualitative interviews and quantitative data from official records. Statistical analyses, including regression models, assessed the relationship between loan disbursement and socio-economic improvements. Results: By December 2006, BKB disbursed Tk 419.33 billion, reaching around 708,200 beneficiaries, particularly through programs like the Landless and Marginal Farmers' Credit Program. Recovery rates were high, but challenges persisted, such as insufficient loan amounts and inadequate training for borrowers, which limited the programs' long-term effectiveness. Conclusion: BKB’s micro-credit program significantly contributes to poverty alleviation by empowering rural communities, especially women. However, to enhance its impact, addressing challenges related to loan sufficiency and borrower training is essential. With these improvements, BKB can further its mission of fostering sustainable economic development in rural Bangladesh.