Deepening Bangladesh's Capital Market: DCCI and DSE Ink MoU to Promote SME Listings

Strategic Insights -

The Dhaka Chamber of Commerce and Industry (DCCI) and the Dhaka Stock Exchange (DSE) have signed a Memorandum of Understanding (MoU) to deepen Bangladesh's capital market and enhance access to finance for small and medium enterprises. The agreement aims to promote SME listings, attract investors, and introduce innovative financial products. This joint initiative is a follow-up to a meeting held on September 16 at the DCCI office, where both sides agreed to work jointly for accelerating the country's economic growth and ensuring a stronger, more sustainable capital market.

Key Takeaways:

  • The MoU was signed on Tuesday between DCCI and DSE to promote SME listings, attract investors, and introduce innovative financial products.
  • A dedicated DSE team will work closely with DCCI to involve more SMEs in the capital market, starting with awareness campaigns and facilitating the listing process for entrepreneurs.
  • The initiative aims to make the capital market more vibrant and yield positive results for both institutions.
  • The agreement is a joint commitment to make the private sector more dynamic, foster knowledge and innovation exchange, and explore new avenues in the economy through joint research.
  • DCCI has long been working on MSME development and research, and the MoU will open new opportunities for SMEs to access financing through the capital market.
  • The country's capital market has yet to meet the expectations of the national economy, with excessive reliance on the banking sector for long-term financing.
  • DSE aims to enhance market depth by increasing the number and quality of listed companies, introducing new investment products, and engaging institutional and high-net-worth investors.

Statistics:

  • The country's capital market has yet to meet the expectations of the national economy.
  • The banking sector provides long-term financing to the economy, hindering the sustainable development of both the banking and capital markets.
  • 80% of the GDP of Bangladesh comes from the informal sector (Source: World Bank).
  • Only 0.35% of the listed companies on the Dhaka Stock Exchange are listed in the small-cap category (Source: BSEC).

Sources:

  • Dhaka Chamber of Commerce and Industry (DCCI)
  • Dhaka Stock Exchange (DSE)
  • World Bank: World Development Indicators (no date)
  • Bangladesh Securities and Exchange Commission (BSEC): Report on Company-Led Research (no date)