I submit my internship report on SME Financing Credit Risk Management, a study conducted by IDLC Finance Ltd, Dilkusha Branch under your cooperative supervision. During my IDLC journey, I tried to collect the necessary information to prepare my internship report and wanted to use it to enrich the report as informative as possible. Also, I will be happy to express my experience working here with you if I find an opportunity.
It is difficult for me to thank all the wonderful people who have contributed any of them to this report. First, we would like to express our gratitude to Almighty Allah, the Most Gracious and Merciful, for enabling us to do the work properly and prepare the report successfully with full endeavour. Leasing companies are the legal owner of the asset, but ownership is effectively transferred to the lessee.
In this report, many things related to credit risk management and SME financing were described. The share of tasks and responsibilities that I did there was explained with an observation and also some problems that I faced during my internship and how I did overcome them were also mentioned.
Introduction
Background of the report……………………………………......1-2
For my internship I joined Credit Information Bureau Department at IDLC under Credit Risk Management Department. Here I was able to produce some practical information that I learned from my daily work in business. Ideally, I will be able to provide a clear picture of the activities and role of Credit Risk Management in SME financing and the Credit Information Bureau in lease and credit risk.
Gaining realistic experience and seeing the application of theoretical knowledge in the corporate world itself. As one of the most respected financial brands in the industry, IDLC Finance Limited maintains a strong and diversified base in the Corporate, SME, Retail and Capital Markets segments. My internship program started on 9th October 2019 in Credit Information Bureau (CIB) department at IDLC Finance Limited, Dilkusha.
In business, an employee often has to perform multiple tasks at the same time. Bangladesh Bank should continue the refinancing system to encourage the entrepreneur in business field.
Motivation of the repot
Scope and limitations of the report
Company and Industry Preview
Company Analysis
IDLC started as a single product lease finance company in 1985 with 5 staff members, 33 years later, it has emerged as the largest multi-product Non-Banking Financial Institution in the country. However, it would be a stretch to say that we are simply in the funding business, as we strive to do something more. We strive to help people achieve their dreams - the dream of owning a house, the dream of sending their children to a bigger school, the dream of going on a picnic in the family car, the dream of to start a business or to expand it. that, the dream of generating more jobs, the dream of taking the nation to greater heights.
Operational Efficiency: IDLC Finance Limited offers customer friendly solutions to meet their requirements so that the loans can be approved and disbursed without hassle. Inefficiency of local banks: One of the main reasons for increasing the Bangladesh leasing company is the inefficiency in providing project loans to local banks. 1. Banks and other NBFIs: The competition between banks and NBFIs is becoming greater than before, as the banks are now also interested in handling leasing items.
If a customer wants to switch from IDLC to any other NBFI, it could obviously pose a threat to IDLC Finance Limited. The company is a wholly owned subsidiary of IDLC Finance Limited, established through a joint initiative of some international and local institutions. IDLC Investment Limited: IDLC Investments Limited is a merchant bank; IDLC Finance Limited also has a wholly owned subsidiary.
Leasing companies may be more knowledgeable about loan items and their value to entrepreneurs than any other organization. Leasing companies may be more aware of loan products and their importance to entrepreneurs than any other institution. First Lease Finance Investment Limited (FLFIL), Apex Investment, Bay Leasing and Investment Limited, Industrial Development Leasing Company (IDLC), Phoenix Finance and Investments Limited, United Leasing Company Limited (ULCL), Lanka Bangla Finance Limited, Investment Credit are the most the best of bangladesh - ranking of players based on performance in the leasing market.
In this case, the difference is that we need to associate the name of the owner with the company. We develop CIF not only from loan applicants, but also from sponsors as well as all the corporation's managers. This software is mostly used in the banking industry, made by Oracle Corporation, the world's second leading software producing firm.
I have gained valuable knowledge and experience from my team from my three-month internship at IDLC Finance Limited. My senior colleagues used to say that everyone in business was very hard to convince.
Overview and History……………………………………………...7-8
Product / Service Mix……………………………………….…...12-14
SWOT Analysis………………………………………….…….….16-18
Specification of the industry
IDLC Securities Limited: IDLC Securities Limited, headquartered in Dhaka Bangladesh, is a stockbroking company. The company provides its clients with investment banking, portfolio management, margin lending and market analysis services that include companies as well as individuals. Return on Assets (ROA): ROA shows how much profits a company receives compared to its total wealth.
Return on Equity (ROE): ROE is a calculation of financial performance by dividing net income by total equity because shareholder equity is equal to the company's assets minus its debt. United Finance is doing poorly compared to IDLC as their ROE is slowly increasing, and as shown above, by a large amount. A rising ROE shows that the company has the ability to generate profits without needing a lot of capital to do so.
Compared to IDLC United Finance, the performance is better as the ratio of United Finance to IDLC increases. The profit margin ratio shows how much profit a business can make after paying its variable production costs such as wages, raw materials, etc. After all expenses have been deducted, what percentage of the remaining revenue is known as the Net Profit Margin.
United Finance is underperforming compared to IDLC, as United Finance's ratio is not higher than IDLC, and it has also declined year-on-year. A higher net profit margin means that a business has more flexibility in converting profits into actual profit. For a company, a higher capital intensity ratio means that the company needs more assets than a company with a lower ratio to generate equal sales volumes.
IDLC performs better compared to pooled finance in terms of capital intensity ration as pooled finance has an increasing amount of capital intensity ratio.
Barriers to Entry
Supplier power
Buyer power
The first leasing company in Bangladesh is the Industrial Development Leasing Company of Bangladesh Limited (IDLC). Today, lease financing is both well-known for improving a company's financial resources and obviously for maximizing profits or increasing the owner's capital. First, after receiving the CIF request, I had to check if the account already exists or not.
We use customer passport or birth certificate as well as mobile number and correct address if voter ID is not available. In this case, we use the company's TIN (Taxpayer Identification Number) instead of the NID number. Any disburser or bank in Bangladesh can request from the CIF account of the customer.
In this situation, when I had no idea about the task, I let my colleagues guide me. Communication skills: I had to communicate regularly with different people from different teams and agencies, both verbally and electronically. We had to organize and distribute tasks among ourselves to complete our tasks correctly and on time.
I faced the very first challenge of dealing with the company's corporate climate because I have never been interested in this type of environment before. On the first day of my internship, I was able to get a good sense of myself among my supervisor and colleagues through a short conversation. The suggestions and guidance of my boss and team members helped me correct myself and empower me to go with the flow.
Based on their deadlines and importance, I took the technique of prioritizing my tasks as advised by my seniors. A separate entity can be formed through the involvement of the public and private banking sectors to invest in small businesses and lend money to SMEs. In order to maintain this, the leasing companies or the related companies must first of all be aware of the competitive challenges they face.
Threats of Substitute
Industry rivalry
Internship Experience
Contribution to the departmental functions………………...29-32
RM will send us an email and we will print it and check whether the copy contains any incorrect information or inconsistencies. I fill in those tabs one by one with relevant information and then check the CIF number. There are some recommendations to build the SME Strategy and achieve the objective of this study, which highlights where SMEs can invest more and what the opportunities are for improvement in this area.
If the method of obtaining a trade license, company registration, obtaining a patent or trademark is easier than the amount of loans that will ultimately help small and medium-sized enterprises to comply with the norm. According to some legislation, public funds can be made from which companies receive money directly and the further formalities will be carried out accordingly. The sector of special SME loan like Women Entrepreneur loan in IDLC which is known as "PURNOTA", another one is "UDBHABON" can be increased to improve SMEs beauty.
If the loan money plan succeeds, there will be much more exciting things to come.
Application of my Academic Knowledge
Conclusion and key facts
Key Understanding
It was not easy for me to focus on two or more subjects at a time and at times I made mistakes. I learned that handling multiple tasks at once is very typical for an employee in the corporate culture.
Recommendation
Conclusion
Financing SME Growth in Africa: What are the Constraints for SME Financing in ECOWAS.
