CREDIT RISK MANAGEMENT IN SME FINANCING: A Study on IDLC Finance Limited

Abstract

Financial Leasing companies deal with tangible assets. Leasing companies are the legal owner but on the other hand ownership is effectively conveyed to the lessee. SME stands for Small and Medium size organization which plays a vital role in the business field now a day. Financing in SME is a pleasure for leasing companies and at the same time this is an advantage for entrepreneurs. In this report many things related to credit risk management and SME financing has been described. First of all, the organization IDLC’s introduction has been given with the analysis of porter’s five forces model and the SWOT Analysis. Then the part of tasks and responsibilities what I did there has been explained with an observations and experience. After that the offered SME loan products by IDLC has been mentioned as the report belong with SME. How the SME team of IDLC choose proper client and what are the things they investigate before sanctioning a loan are also in this report which I gathered by interviewing two employees of IDLC. Also some financial analysis has been given to compare IDLC with another top ranking leasing company United Finance. The overall scenario of leasing companies in Bangladesh has been explained in this report. According to the objective the recommendation has been stated.