Bangladesh with its 40% people living below poverty line and 18% living in absolute poverty is suffering from acute rural-urban economic disparity coupled with illiteracy, lack of proper health and sanitation facilities. The country's economy is basically an agrarian one with vast majority living in rural areas. The agriculture sector is unable to provide any further scope for employment resulting in influx of rural population towards urban areas. Rural areas are characterised by stagnant agriculture and scanty industries. Underemployment and unemployment is a regular phenomenon particularly in rural areas. The vast human resources have remained unutilised due to lack of education, proper training and concerted efforts to help grow the rural economy. This results in uneven distribution of income which causes serious set back in balanced geographical growth as well as growth of GDP.

Islami Bank Bangladesh Limited was founded with the major objective of establishing Islamic economy for balanced economic growth by ensuring reduction of rural-urban disparity and equitable distribution of income.

In view of the above, Branches of the Bank have been encouraged to invest their deposits in their respective areas and in particular for the economic upliftment of the rural people.

Accordingly, a Scheme in the name and style of 'Rural Development Scheme' has been introduced to cater to the investment needs of the agriculture and rural sector to create opportunity for generation of employment and raising income of the rural people with a view to alleviate poverty.

Objectives

• To extend investment facilities to agricultural, other farming and off-farming activities in the rural areas.
• To finance self-employment and income generating activities of the rural people, particularly the rural unemployed youths and the rural poor.
• To alleviate rural poverty through integrated rural development approach.
• To extend investment facilities for rural housing, keeping in view the needs of housing facilities of the rural dwellers.
• To provide educational services and safe drinking water, sanitation & medicare facilities to the down trodden people.

Target Group

• Farmers having land holding of maximum 0.50 acres.
• Sharecroppers with consent from the landowners.
• Persons engaged in off-farm activities having no land or l6and up-to-maximum 0.50 acres.
• Persons/farmers permanently residing in the selected villages.
• Persons having derelict pond will be eligible for investment for re-excavation and fish cultivation.
• Destitute women and distressed people will be provided investment for milch cows/poultry birds/ducks/goats etc. and other suitable off-farm activities for raising their supplementary income.
• Persons having liabilities with other banks/institutions including defaulters will not be eligible for investment under the Scheme.

Centre Fund

Each member of the Group has to deposit minimum Tk.2.00 per week in the Centre Fund. This Fund is kept by opening a Mudaraba Savings Account in the name of the respective centre. This Fund is utilised for the welfare of the members by way of Quard as per decision of the Centre in the weekly meeting. This account is operated by Centre Leader & Deputy Centre Leader jointly. This fund is refundable.

Modes of Investment

No security is required against investment under the Scheme as entire Scheme has been drawn taking into account the social welfare objective of the Bank for upliftment of the socially down-trodden and economically backward and weaker section of the population of the society. However, Group discipline should be strictly followed and complied with so that only the right persons are selected and included as members of the Group.
Besides, each member of the Group gives personal guarantee for other members of the same Group and the members are jointly and severally liable and responsible for payment of investment.

Sanction and Disbursement

On the basis of the list submitted by the Field Officers, the Investment Committee of the Branch carefully scrutinises the applications and sanction the investment at the Branch level. The Investment Committee consists of Manager, Project Officer and the Field Officer. After sanction of the investment the Branch complete documentation formalities and then disburse the amount with the help of the Investment Officer and Field Officer. In all the cases Branch must ensure strict adherence to the banking and Shariah norms.

Performance of RDS