Sure-fire ways of getting an ICT loan in Bangladesh

Bangladesh is recognized as the third-largest population to outsource their resources through the internet and mainly through freelancing. However, when it comes to start-ups, many struggle to gain a firm foothold. By the entry of 3G internet in 2013, usage has boosted over 22% by the end of 2014.

Needless to say, the government has been taking steps to realize the dreams of a Digitalized Bangladesh; and have introduced multiple ways to broaden the field of entrepreneurship in multiple sectors alongside including ICT over the years. Along with the Government, private organizations have started offering loans and grants to realize the potential of these budding ventures. 

Here are some ways of getting a loan for an ICT organization or start-ups:

StartUp Bangladesh

The Government has taken the initiative to make an Eco-system where entrepreneurship can be nourished to realize their full potential. This effort will allow the country to innovate at a much faster rate. And enhance the ability to create new jobs and to develop technical skill; all leading to realize the vision of Digital Bangladesh.  

In support of these objectives, the government has created a fund under iDEA project. The Investment will provide all the necessary capital to pick up the pace in development and achieve success in the planned businesses and the process remains transparent, impartial and accountable.

Criteria for Application: 

The criteria to receive any loans or investment grants from StartUp Bangladesh are divided into the following categories:

  • IDEA SUPPORT – This requires a feasible business plan and an executable business plan.
  • VENTURE CAPITAL –
  • Seed stage: Requires prototype of a business model and plan.
  • Growth stage: Requires a viable product and an existing customer base.
  • Guided start-up: Requires a start-up idea under national interest.
  • TARGETED INVESTMENTS – This fund may take part as a collaboration under the Public-Private Partnership (PPP) model or other entities that seem fit for this investment module that includes training up facilities.
  • STRATEGIC PARTNERSHIP – This fund may take part in partnerships with local or international institutes to acquire the desired requirement for entrepreneurship development.
  • CO-INVESTMENTS – This fund may enter with other venture capital funds or funding entities that will help the development while sharing risk factors for the business, usually for larger investments.

Any application submitted is reviewed by a board of committee members who rank the top in the ICT industry and the procedures are then followed through step by step accordingly, all of which is listed in the official website of StartUp Bangladesh.

Bangladesh Bank 

The government has been taking steps to prioritize the roles of entrepreneurship in Bangladesh towards the ICT sector and has introduced the ESF (Entrepreneurship Support Fund) for multiple sectors in the country.

Included are ICT and the Agricultural sector while the previous EEF loan system that contained zero interest is abolished. However, this seemed unfruitful as most clients had failed to meet the expected outcomes. The ESF has a four-year grace period set, after which clients will have to pay 25% principle amount and interest every year. Which is a different approach from the previous EED loans. Clients themselves have to provide 51% as the impartiality of the project cost and invest it within one year after securing the approval from the Investment Corporation of Bangladesh (ICB).

Criteria for Application: 

  • ICT business model which needs to be feasible.
  • Cannot take any other loans for the project while in this program.
  • Needs authentication from clients – cannot be a defaulter from any banks in Bangladesh.

IDLC Finance Limited

A program launched in 2015 for financing for ICT entrepreneurs. It offers tailored solutions to boost businesses for their clients. The program “IDLC Udbhabon Loan” is in association with BASIS organization. However, it is not only financial services for ICT companies; but will also refer to corporate clients to BASIS if software purchases are required. And the customers will receive special discounts in this manner.

Criteria for Application:

To check for eligibility for the “IDLC Udbhabon Loan”; clients need to be 20 to 60 years of age. And the business applied for needs to be in two years of operation. However, the time of operation is halved for female entrepreneurs. After application, IDLC will reach out if the criteria’s are met and it is something they look forward towards investing.

5 Bangladeshi platforms where you can pitch your startup

There is an imminent need for entrepreneurs who are willing to change Bangladesh, home to 160 million people, for the better . Professionals are being encouraged to defy convention and pursue entrepreneurship over traditional career paths like doctors and engineers, now more than ever. However, entrepreneurs need the know-hows and the resources which are hard to get, especially at the beginning. With a growing local start-up ecosystem, we can only hope that more industry experts will pave the way for young bloods to build sustainable businesses.

A number of Bangladeshi startup incubators have been working closely with local talents to scale up businesses, especially tech ventures.

Our country abounds with go-getters who can shape our economic landscape for the better. And these platforms can be a breeding ground of startups that can have commercial success in Bangladesh, possibly across the world. Here are 5 deshi incubators where you can pitch your dream startup.

Grameenphone Accelerator 

The GP Accelerator is an incubator that accelerates 5 startups every year.
35 teams are called in to participate in a two-day long boot camp, from which 15 startups were selected for further rounds of assessment, face-to-face interviews and pitch presentations. Finally, after fierce competition, five companies are selected. This way, from over a thousand applications, 5 standout companies are selected on the basis of the team’s ability to execute and the strength of the business.

GPA provides a 4-month bootcamp at GPhouse. Office space, structured curricula, investor access and mentorship are offered to the top 5 teams in this program.

Teams get the opportunity to learn from local and foreign mentors, industry experts and professionals on critical development elements like term sheet, valuation, financial modeling, branding, etc. Starting from 2014, 5 batches of startups have graduated from this program. Winners receive seed funding of 12+ lakh taka and Grameenphone may take up to 8-10% equity. Some of the notable alumni include Sheba, CMED, Doctorkoi etc.

More about Grameenphone Accelerator

Toru Impactors

The Toru Institute of Inclusive Innovation has launched the ‘Impactor’ program for early stage startups. Saif Kamal, founder of Toru said in an interview, “We have always had accelerator programs or competitions, but ideas need extensive and long-term support in order to become impactful enterprises.” Impactor program is a 8-month long business incubation program for entrepreneurs who want to transform their idea, early form of a product or an early stage business into a successful business enterprise with a social impact.

30 Impactors learn through a series of workshops. From that cohort, 15 Impactors are selected to continue their engagement, building a business model canvas and growth strategy. The top 10 Impactors embark on a 6-month long journey of business incubation, taking their venture to grow and be investment ready. These Impactors are matched with experts from their respective sectors, receiving individually tailored support. The final 3 Impactors receive up to 10 lakh taka seed funding, and workspace from Startup Bangladesh.

Startups who have worked with Toru include Sheba.xyz, iFarmer, ShopUp and 10MS.

More about Impactors

Urban Innovation Challenge

“Our cities, our solutions”- with this motto, UIC embarked on the journey to find urban entrepreneurs to reshape our cities with a smart solution. UIC throws 5 challenges which are healthcare, wash, renewable energy, climate change and low-cost urban housing. 5 teams are selected for incubation and each of them receive 5+ lakh taka seed funding. Hands-on training, access to partnerships. further funding opportunities- UIC has it all. The best thing about UIC is that it empowers startups to make our urban lives better. Besides commercial success, startups should also demonstrate societal impact, which UIC strives to achieve. UIC is powered by BRAC.

More about the Urban Innovation Challenge

Tiger Cage  

Are you one of those people who binge ‘Shark Tank’ and wishfully think of a Bangladeshi reality show about seed funding? If yes, you’ve got it. ‘Tiger Cage’-an incubator in the form of a reality show where real investors meet real entrepreneurs. Startups with demonstrable prototypes pitch their idea to angel investors. The judges of this show are the ‘Tigers’; when they are convinced, they can choose to invest in the businesses. Participants can get funding of as much as 2 crore taka.

Intelligence Machines Limited, the first startup featured on the pilot episode, have raised 2 crore taka of funding in exchange for 45% of ownership. Sounds cool, huh? Tiger Cage is an initiative of Startup Dhaka.

More about Tiger Cage

iDEA Accelerator

iDEA Accelerator was founded by ICT ministry of Bangladesh to foster the culture of entrepreneurship among innovators. Startups that are in both ideation or seed stage are eligible to apply for enlistment. A big cohort of early tech companies have received funding from this platform. It is commendable to see that our govt. is taking part in the revolution of the startup era.

More about iDEA Accelerator

The startup culture may have been romanticized by movies and tv shows, but it’s quite challenging in real life, to say the least. It takes a lot of dedication, failure and passion to see a dream flourish. Do check out these prominent platforms to get that leg up. Who knows, you may be building the next Pathao or 10 Minute School.