Business Initiative Leading Development (BUILD) and the United Nations Capital Development Fund (UNCDF) have launched a multi-stakeholder working group to improve access to green and sustainable financing for small and medium enterprises (SMEs) in Bangladesh.
The SME Green Transition Working Group (GTWG) was launched at an inception workshop in Dhaka yesterday (29 October).
The initiative is being implemented under UNCDF’s Access to Green Finance (A2GF) for Enterprises Programme, funded by the Embassy of Switzerland in Bangladesh.
Speaking at the workshop, BUILD CEO Ferdaus Ara Begum said cottage, micro and small enterprises account for approximately 99% of manufacturing enterprises in Bangladesh but face significant barriers to accessing formal financing.
She identified limited access to affordable finance, complex procedures and documentation requirements as major obstacles to adopting resource-efficient technologies and sustainable business practices.
The working group will focus on four priority areas: finance and incentives; environmental, social and governance (ESG) standards and measurement, reporting and verification (MRV); technology and circularity; and policy and regulatory reform.
Mohammad Navid Shafiullah, additional secretary at the Ministry of Environment, Forest and Climate Change and chair of the working group, identified six critical areas for the green transition: efficient resource use, green financing, technology transfer and skills development, market expansion, climate resilience, and coordination and accountability.
He also said the draft carbon market framework was almost finalised and awaiting cabinet approval.
Former finance secretary Mohammad Muslim Chowdhury said Bangladesh could no longer rely solely on its labour-cost advantage as technology increasingly replaces traditional labour-intensive activities.
He called for better coordination among existing financing initiatives.
Presenting an analysis of the challenges, BUILD Research Director Wasel Bin Shadat said SMEs account for around 99% of Bangladesh’s 11.7 million industrial units, contribute approximately 30% of GDP and are associated with about 85% of industrial employment.
He noted that SMEs receive only 1–5% of green financing, despite the expansion of available financial instruments.
A proposed 12-month roadmap includes piloting standardised green-investment applications with at least three banks, testing simplified sustainability reporting among 100 micro and small enterprises, and conducting energy and resource audits for 50 SMEs in an industrial cluster.
The recommendations will inform the working group’s 2026–27 workplan, including priority activities, stakeholder responsibilities and potential technical and financial support.
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