Impact of Rural Development Scheme of Islami Bank Bangladesh Limited (IBBL) Upon Economic Development of the Rural Poor of Bangladesh

Abstract

Bangladesh, the smallest but populous country in the South Asia region with 160 million people, More than 60% of its citizens live in the villages, and 50% of the total population depends on agriculture. Rural people also control more than 30% of the entire economy. Most of the village people are highly interested in cultivation and other production where needs physical effort, but they were suffering from the fund crisis that hinders the production of crops and the cultivation of fisheries and livestock. Due to the financial crisis, they involved their children in cultivating and farming instead of sending them to school. According to the necessity of financing to planting different aspects, they are collect petty cash as a short term loan from neighborhood moneylenders and other various NGOs at a high rate of interest. This orientation carries unlimited agonies to the country based business visionaries. The Trending Microfinance Institutions (MFIs) provides small loans among low salaries in Bangladesh with the end goal of lightening neediness and enabling poor people. Commercial business banks in Bangladesh are likewise connected to offer smaller-scale money related administrations. Islami Bank Bangladesh Limited, a private Islamic oriented bank, offered the Rural Development Scheme (RDS). This imaginative Islamic microfinance system answers the interest of the country Muslim poor in Bangladesh, who were forgotten about from ordinary smaller scale financing because of religious convictions. The RDS's key empowering agents are social condition, a helpful strategy condition, institutional and authoritative limit, and a devoted administration with the vision to scale up the RDS program in Bangladesh. In contrast to customary NGOs and microfinance organizations (MFI), Islamic MFIs lend advance cash in kind; the product's responsibility carefully lies with the store to the supplier until the client has wholly reimbursed the agent. The reason for this paper is to analyze the capability of Islamic Microfinance as an elective apparatus for destitution lightening. This RDS microfinance's analysis examined both economic and social effects and invested at a general end that this program remarkably affects the chosen financial parts of the customers. Data have been collected through questionnaires from the needy rural beneficiaries from selected three areas in Chittagong district named Boalkhali, Banskhali, and Baroyiarhat. The choice of selected these three areas is located in the surround of the section from three sides. So the outcome of this questionnaire gave an approximate picture of the district. Collected data have been analyzed using different statistical tools to get the results and suggest policy implications, if any.