Bank credit concentrates in Bangladesh’s commercial hubs
Bangladesh’s banks lend mainly to Dhaka and Chattogram, leaving vulnerable coastal districts with scarce financing.
21 Oct 2026 0 reads Compiled with AI
Bank lending in Bangladesh is heavily skewed toward the capital city Dhaka and the commercial hub Chattogram. Together the two divisions account for about three‑quarters of the country’s total loans and advances, which stood at $146.55 billion (18.09 trillion Bangladeshi Taka) in the April‑June 2026 quarter. The rest of the country, including several districts that face frequent cyclones, floods and salinity, receives only a small share of formal credit. The World Bank has highlighted Bangladesh as highly vulnerable to climate change, yet the flow of bank credit to those most at risk remains low.
Lending concentrated in commercial centres
Even in districts that are exposed to the most extreme weather, loan volumes are tiny compared with deposits. In Satkhira the bank loans totaled $355.71 million (43.91 billion Taka), only about 0.24 % of total lending, while deposits were $745.03 million (91.97 billion Taka). Patuakhali recorded $280.13 million (34.58 billion Taka) in loans versus $573.54 million (70.80 billion Taka) in deposits. Sunamganj’s loans were $191.67 million (23.65 billion Taka), 0.13 % of total credit, against $642.74 million (79.31 billion Taka) in deposits. Local entrepreneurs such as Saiful Gazi in Satkhira have found it hard to secure institutional financing; his recent loan application was rejected because of insufficient collateral, forcing him to borrow from a high‑interest NGO instead.
Bank officials say the low exposure reflects a lack of commercially viable projects and limited business activity in these areas. Arief Hossain Khan, Bangladesh Bank spokesperson, argued that lending depends on the availability of profitable ventures and that the banks are reluctant to explore opportunities in rural regions. He suggested that climate‑adapted agriculture, handloom and local handicrafts could be viable if supported by targeted financing. Similarly, Syed Mahbubur Rahman of Mutual Trust Bank noted that adaptation projects often lack predictable returns, while climate‑finance experts like Md Shamsuddoha and Masrur Reaz emphasise the need for low‑interest, flexible loans to help communities recover and prepare for future shocks.
Why vulnerable regions are under‑financed
Without more geographically balanced financing, households and businesses in the coastal belt and flood‑plain regions will struggle to rebuild after disasters and invest in resilience. The Bangladesh Delta Plan 2100 identifies 58 of the 64 districts as highly vulnerable, yet formal lending continues to mirror the concentration of industry. Experts argue that climate‑resilient agriculture, improved irrigation and climate‑smart housing are crucial, but they require private‑sector credit that is both affordable and tailored to local conditions. A shift toward inclusive lending could strengthen both the economy and the country’s climate resilience.