Consumer Credit Services in Bangladesh: Trends, Problems and Prospects

Abstract

The study provides an overview of the developments in the consumer
credit services in Bangladesh. The purpose of the study is to describe the trends,
problems and prospects of consumer credit services in Bangladesh. Both the
qualitative and the quantitative research have been conducted for this study. 500
customers and 76 bankers were selected as sample for interviewing. The increasing
rate of disbursement of consumer credit scheme in the majority banks in
Bangladesh indicates that consumer credit has huge demand in this country. The
consumer credit schemes of different banks are not equally well fitted for the
expectation of the customers. Interest rate, fees, charge, procedures, proof of
income, documentations, quotation, delay response from bank employees, cordial
behavior, small frame of time, insufficient financial support, negative attitude
towards low income group, clumsy application form, critical procedure, guarantor
are problems of this scheme. The study highlights that bankers should take extra
care to improve the quality of the consumer credit scheme. Rules, regulation &
policy of the consumer credit scheme should be set to meet consumers’ expectation.
Interest rate, processing fees, late payment fees, and hidden charge of the scheme
should be reduced for increasing the demand of the consumer credit. Most of the
branches of banks should be offered this loan to consumers for ensuring the
availably of the credit.