Determinants of SME Business in Mymensingh


Md. Tanjil Hossain

Journal: Bangladesh Journal of Political Economy

(pp: 509-520) | Doi No: http:/



The objective of this study is to examine the role of Small and Medium Enterprises (SME) to reduce poverty and unemployment in Mymensingh. Unemployment  is major problem in Bangladesh. The unemployment rate is about 4.5 % in Bangladesh. The Small and Medium enterprise growth are about 26% and 8% respectively. Small and Medium enterprise employment growth are about 17% and 12 % respectively during the time between 2003 and 2013. The poor is about 50% and extreme poor is 30% in Mymensingh. So, Mymensing is the important place to study. To surve th purpose, the data have been collected from 252 (SME) owners from three upazilas of Mymensingh. This upazilas are Trishal, Valuka and Mymensingh Sadar during the time between 3rd December 2020 to 3rd January 2021. In this study OLS method is used to determine the determinants of SME turnover. The results show that access to SME credit, education, total investment and initial investment are positively and significantly related to turnover. Another important finding is that the more the educated SME owners are the higher the turnover is. This encourages educated person to start SME business. This indicates that if SME credit is increased the turnover will be high. It is also seen that the higher the initial and total investment is the higher the turnover is. The R2 is 0.50. This indicates that the explanatory variables can 50% explain the variables. It is also seen that women entrepreneur is only 8% in the study area. In addition to this, the SME owners receive more loan from private banks than the public banks although the rate of interest was high in private banks during the study time in the study period. So, policy should be taken to increase women entrepreneur and public banks officials behaviour is to be improved.



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