Deposit Products The Bank mobilises deposits through the operation of the following accounts. ← Al-Wadeah Current Account (AWCA) ← Mudaraba Savings Account (MSA) ← Mudaraba Term Deposit Account (MTDR) ← Mudaraba Special Notice Account (MSNA) ← Mudaraba Hajj Savings Account (MHSA) ← Mudaraba Special Savings (Pension) Account (MSSA) ← Mudaraba Savings Bond (MSB) ← Mudaraba Monthly Profit Deposit Account (MMPDA) ← Mudaraba Muhor Savings Account (MMSA) ← Mudaraba Waqf Cash Deposit Account (MWCDA) ← Mudaraba NRB Savings Bond (MNSB) Account ← Mudaraba Foreign Currency Deposit Account (MFCD) ← Students Mudaraba Savings Account (SMSA) ← Mudaraba Farmers Savings Account (MFSA) (Ready for launching) Current account is operated on Al-Wadeah Principle and all other deposit accounts on Mudaraba principle of Islamic Shari'ah. The bank distributes minimum of 65% of its investment-income earned through deployment of the Mudaraba deposits among the Mudaraba depositors. ent The special feature of the Investment Policy of the Bank is to invest on the basis of profit-loss sharing system in accordance with the tenets and principles of Islamic Shari'ah. Earning of profit is not the only motive and objective of the Bank's Investment Policy rather emphasis is given in attaining social goal and objective in creating employment opportunities. Modes of Investment ← Bai-Murabaha ← Bai-Muajjal ← Hire Purchase Under Shirkatul Melk ← Mudaraba ← Musharaka ← Bai Salam
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Deposit Products
The Bank mobilises deposits through the operation of the following accounts.
← Al-Wadeah Current Account (AWCA)
← Mudaraba Savings Account (MSA)
← Mudaraba Term Deposit Account (MTDR)
← Mudaraba Special Notice Account (MSNA)
← Mudaraba Hajj Savings Account (MHSA)
← Mudaraba Special Savings (Pension) Account (MSSA)
To extend investment facilities to agricultural, other farming and off-farming activities in the rural areas.
To finance self-employment and income generating activities of the rural people, particularly the rural unemployed youths and the rural poor.
To alleviate rural poverty through integrated rural development approach.
To extend investment facilities for hand tube-wells and rural housing, keeping in view the needs of safe drinking water and housing facilities of the rural dwellers.
To provide education and Medicare facilities to the down-trodden people.
Bangladesh with its 38% people living below poverty line and 18% living in absolute poverty is suffering from acute rural-urban economic disparity coupled with illiteracy, lack of proper health and sanitation facilities. The country's economy is basically an agrarian one with vast majority living in rural areas. The agriculture sector is unable to provide any further scope for employment resulting in influx of rural population towards urban areas. Rural areas are characterized by stagnant agriculture and scanty industries. Underemployment and unemployment is a regular phenomenon particularly in rural areas. The vast human resources have remained unutilized due to lack of education, proper training and concerted efforts to help grow the rural economy. It results in uneven distribution of income which causes serious set back in balanced geographical growth as well as growth of GDP.
Islami Bank Bangladesh Limited was founded with the major objective of establishing Islamic economy for balanced economic growth by ensuring reduction of rural-urban disparity and equitable distribution of income.
In view of the above, Branches of the Bank have been encouraged to invest their deposits in their respective areas and in particular for the economic uplift of the rural people.
Accordingly, a Scheme in the name and style of 'Rural Development Scheme' has been introduced in 1995 to cater to the investment needs of the agriculture and rural sector to create opportunity for generation of employment and raising income of the rural people with a view to alleviate poverty. It is treated as first Islamic Microfinance Model in the Country & abroad.
Humanitarian Assistance Program.
Education Program.
Capacity building or Training Program.
Health & Medicare Program.
Environment protection Program.
Initially the Scheme was started as a Pilot Scheme in the rural areas of certain districts under the direct supervision of the nearby Branches of the Islami Bank Bangladesh Limited.
The Scheme is being gradually extended to all the Districts through different Branches of the Bank.
Integrated Development approach
The purpose of the Scheme is not only providing Micro Investment facilities to the stake- holder but also ensure various types of facilities & services to the downtrodden people as a part of Integrated Development Approach as well as Corporate Social Responsibility. The following areas have been covered under the Scheme:
Target Area
Purpose, Period and Ceiling of investment
Sl. Sector of Investment Duration Ceiling of Investment(BDT)
Equivalent USD ($1.00=Tk.69.00)
1 Crop Production 1 year 25,000/- 362
2 Nursery and commercial production of Flowers & Fruits
1 year 50,000/- 725
3 Agriculture Implements 1 to 3 years 50,000/- 725
4 Live stocks 1 to 2 years 50,000/- 725
5 Poultry & Duckery 1 year 35,000/- 507
6 Fisheries 1 to 2 years 50,000/- 725
7 Rural Transport 1 year 20,000/- 290
8 Rural Housing 1 to 5 years 50,000/- 725
9 Off-firm activities 1 year 50,000/- 725
The clients are provided investment maximum of BDT 10,000/-($145) at the first time and the good performers are given enhancement, upon his requirement, by BDT 2,000 to BDT 5,000 in every next term up to the ceiling of a particular sector.
Performance of RDS
Rate of Return
■ The rate of return is determined by the authority from time to time. ■ At present, the rate of return is 12.5%. Timely repayment is encouraged by offering 2.5% rebate.
Performance of Rural Development Scheme up to June 2010.
Islami Bank Bangladesh Limited launched its Rural Development Scheme (RDS) in 1995. In the mean time, 144 Branches of the Bank have been operating the activities of the Scheme in their respective areas. These Branches are working among the poor in 10,754 villages covering 1,199 unions under 296 Thanas of 61 districts of the country. Present number of members is 5,01,941 since beginning the scheme. The members are provided investment facilities an amount of BDT 28,100.10 million ($ 407.25m) up to 30-06-2010 against which the outstanding was BDT 4,320.41 million ($ 62.61m). Rate of recovery of the Scheme is more than 99%.
Besides the regular investment program, we have provided with hand tube-well and sanitary latrine to the successful RDS members on quard from the fund given by Islami Bank Foundation. A total of 7,946 tube-wells & 4,322 sanitary latrines have so far been distributed at a cost of BDT 15.84 million ($ 0.23m) & BDT 4.76 million ($ 0.07m) respectively up to the said date.
A brief performance of RDS up to June, 2010 is shown in the following table:
Fig. in million Taka ($)
Sl. Areas of performance No.&Volume/Amnt.Area Coverage
1 No. of Branches handling the Scheme 1772 No. of Villages (no. of total village in the country is about 87,000) 128573 No. of Districts (no. of total district in the country is 64) 61 4 No. of Centers 222065 No. of Groups 1322686 No. of Members (existing) 6087037 % of Women members in the Scheme8 Average no. of members per Centre (expected no. 40) 289 No. of Clients (Who availed investment) 382319
Financial Statement (RDS & MEIS)
10 Cumulative disbursement (since inception) 42,285.23 (million)11 Present outstanding 7072.02 (million)12 Overdue 29.63 (million)13 Percentage of Recovery 99.58% 14 Balance of Members’ Savings (including Centre Fund) 1924.74 (million)
Financial Statement (MEIS)
15 Number of clients under MEIS 3901516 Cumulative disbursement (since 2005)17 Present outstanding 2413.57 (million)
Manpower Position
18 No. of Field Officers 1954 19 No. of Project Officers20 No. of Zone Officers
SME Information
Islami Bank Bangladesh Limited has been working since 1983 in the view to establish a welfare oriented Islami Banking system and
also to ensure equity and justice in the field of all economic activities, achieve balanced growth and equitable development through
diversified investment operations particularly in the priority sectors and less developed areas of the country and to encourage socio-
economic uplift and financial services to the low income community, particularly in the rural areas. Since inception of the Bank, it
has been giving priority in financing SMEs.
Formation of SME Division
The Board in its emergent meeting held on 02.11.2005 approved a memo bearing No. 2005/155 with the following resolution:
“Resolved that the investment in Small Enterprise shall be made in accordance with the terms and conditions contained in the
Annexed “Comprehensive Small Enterprise Investment Policy” and SME Division under Investment Wing shall be established with
necessary restructuring and duly manning with adequate officials as proposed.”
In order to emphasize SME investment, to run its SME functions smoothly and to strengthen the SME activities of the bank, it has
created a separate Division namely “Small and Medium Enterprise Division” in 2009.
Security Requirements
■Generally, collateral security is not required against investment under the Scheme, as the Scheme has been drawn taking into account the social welfare objective of the Bank for upliftment of the socially down-trodden and economically backward and weaker section of the population of the society. However, Group discipline should be strictly followed and complied with so that only the right persons are selected and included as members of the Group.
■Each member of the Group gives personal guarantee for other members of
the same Group and the members are jointly and severally liable and responsible for payment of investment.
Specialized SME Branches
As per guideline and regulation of Bangladesh Bank, the Board of Directors of the Bank has selected a good number of SME prone
areas, where Specialized SME/Agriculture Branches are being opening in order to facilitate the potential entrepreneurs in accessing
to the finance from Sharia’h based banking sector. So far 30 nos. of such Specialized SME Branches have been opened and more
such Branches shall be opened at the SME prone areas by order.
Eligibility of clients
General eligibility criteria for selecting/investing an SME client are listed below:
← Physically capable Bangladeshi national
← Proprietorship/ Partnership/ Private Limited Company
← Valid licenses like Trade License, VAT Registration, TIN etc. NOC from Environment Directorate (as applicable) from
competent authority
← Source and capacity of repayment backed by positive cash flow
← Definite market and prospect of future expansion
← Clean CIB report
← Adequate infrastructure facility and manpower with required skill and experience
← The client must have clear idea about the business and required experience.
← All other criteria laid down in the Instruction Circular, Manuals of relevant investment product.
Restriction on facility
← Any of IBBL’s director, employee or their family member holding 5% or more of the share capital of the Small Enterprise
← The applicant is engaged in any antisocial and/ or anti-state activity
← The applicant has been declared bankrupt/insolvent/insane by any competent authority of the country
SME Investment
Purpose of Investment
← To meet Capital Investment for establishment of Project.
← To meet working capital requirements (i.e. Procuring of Raw materials & trade goods, overhead expenses etc.).
← Other items approved by the Bank and as per norms of the Scheme/Mode etc.
Mode of Investment
← Capital Investment: Hire Purchase Shirkatul Melk (HPSM), Musharaka and Mudaraba.
← orking Capital for all concerns i.e. Manufacturing, Trading and Service: Bai-Murabaha, Murabaha (TR), Murabaha Post
Import, Musharaka, Mudaraba, Bai-Muajjal Post Import, Bai-Muajjal, Bai-Salam and Istishna.
← Specific Modes of investment for the Schemes and other items as per existing norms.
Special Schemes under SME
IBBL has been financing SMEs through the following special schemes under SME besides above mentioned modes and purposes
of Investment
← Women Entrepreneurs’ Investment Scheme (WEIS)
← NRB Entrepreneurs’ Investment Scheme (NEIS)
← Micro Industries Investment Scheme (MIIS)
← mall Business Investment Scheme (SBIS)
← Transport Investment Scheme (TIS)
← Micro Entrepreneurs Investment Scheme (MEIS)
In order to strengthen the aforementioned schemes and the schemes to be introduced in future, at least 10-20% growth in terms of
exposure has to be achieved per year.
Sanctioning Authority
Sanction of investment under SME shall be done as per existing delegation of authority approved by Head Office for different
Nature, Modes and Schemes of investment and as per amendment made/to be made from time to time by Head Office.
SME Sectors
Manufacturing
Enterprise involved in production process viz. food & agro-based, leather, textile, handicrafts, pharmaceuticals, electrical
accessories, recycling etc.
Trading
Enterprises involved in wholesale and retail trading, export and import etc.
Manufacturing
Enterprise providing services to other persons, organizations, viz. telecommunication, transport, information technology, clinics,
hotel, restaurants, workshops etc.
Size of SME Investment
Category Attributes under the
categories
Total Assets (at cost) And/or total number
of employees
Small Enterprise Service Concern Tk. 5 lac to 1 Crore
(Excluding land and building
including Replacement Cost )
10 to 25
Trading Concern Tk. 5 lac to 1 Crore
(Excluding land and building
including Replacement Cost )
10 to 25
Manufacturing Concern Above Tk. 50 lac to 10 crores
(Excluding land and building
including Replacement Cost)
25-99
Medium
Enterprise
Service Concern Tk. 1 Crore to 15 Crores
(Excluding land and building
including Replacement Cost )
50 to 100
Trading Concern Tk. 1 Crore to 15 Crores
(Excluding land and building
including Replacement Cost )
50 to 100
Manufacturing Concern Above Tk. 10 Crores to 30 crores
(Excluding land and building
including Replacement Cost)
100-250
If any entrepreneur falls under SE category on the basis any one standard, but the same falls under Medium category on the basis
of the other standard, then the enterprise shall be treated as Medium Enterprise.
From the date of circular, cottage and micro enterprises shall be incorporated under the SME Investment
Policy & Programmes of Bangladesh Bank. The definitions for Micro Enterprise and Cottage Industries as
set by Bangladesh Bank are depicted below:
Category Attributes under the
categories
Total Assets (at cost) And/or total number
of employees
Micro Enterprise Service Concern Less than Tk. 5 lac
(Excluding land and building and
including Replacement Cost )
Less than 10
Trading Concern Less than Tk. 5 lac
(Excluding land and building
including Replacement Cost )
Less than 10
Manufacturing Concern Tk. 5 lac to 50 lac
(Excluding land and building
including Replacement Cost)
10-24 or less
Cottage Industry Less than Tk. 5 lac
(Excluding land and building
including Replacement Cost)
Not more than 10
including family
members
If any entrepreneur falls under Micro category on the basis any one standard, but the same falls under Small category on the basis
of the other standard, then the enterprise shall be treated as Small Enterprise.
Mood & Period of SME Investment
Mode of Investment Terms
Working capital Maximum up to 100% of the net required working capital or 75% of the sum
total of inventory and receivables whichever is lower. However, at present,
IBBL shall make investment upto 80% of net Working Capital.
Capital Investment Maximum up to 90% of the purchase price.
Nature of Investment Period of Investment
Term Investment Mid term: Maximusm 5 (five) years
Long term: Above 5 (five) years
Working Capital/Trade Financing Maximum 1 (one) year on revolving basis
Other Schemes/Investment Products As per existing Head Office Circulars.
Locker Service
Our safe deposit locker service offered from select branches gives you a completely secured facility for safekeeping of precious
items, confidential documents and other valuables.
Services
← Personalised service
← Facilities to access outside scheduled time
← Parcel handling
← Safe custody of goods and bonds/shares
← Lockers available in various sizes. i.e. Small, Medium and Large.
Terms & Condition
← For obtaining a Locker at IBBL you must be an account holder with our Bank.
← Lockers can be allotted individually as well as jointly.
← The Locker holder is permitted to add or delete names from the list of persons who can operate the Locker and can have
access to it.
← Loss of Key is to be immediately informed to the concerned Branch.
← For Schedule of Rentals, please contact the branch nearest to you.
← An individual (not minor), firms, limited company, associations, clubs, trusts, societies, etc may hire a locker.