The power of buyers describes the effect that customers have on the profitability of a business. The transaction between the seller and the buyer creates value for both parties. But if buyers (who may be distributors, consumers, or other manufacturers) have more economic power, then the firm’s ability to capture a high proportion of the value created will decrease, and the firm will earn lower profit. Considering the global financial downturn and also the current economic situation of the country it is seen that customers are reluctant to go for new investments and also due to the global financial turmoil it is seen that imports have been reduced to a greater extent. As a result fewer importers are opening LC’s through BRAC and other banks. Moreover fewer investors are taking loans from the banks. As the switching costs is not that high, customers often tend to go for those banks where they provide low cost and quality services These factors implies that the customers of BRAC Bank have a high bargaining power.
Chapter -4 FINDINGS • • • • • • • • • •
SME loan is popular in rural area. But problem is management cost is very high for that reason people are discouraged on SME loan. As a rural area base loan system, bank face huge problem to collect minimum documentation against on loan. Another problem are arise when CRO going to collect installment. It’s really tough to collect installment. Maximum loan borrowers are not qualified for loan. There are vast areas in agriculture to investment. But investment is very low. There is no specific research institution for SME loan. Loan processing time is 1 month or more. So it creates a problem. Customer feels CRM harassment. Customer want long term loan, now maximum time is 36 months. Another big problem is online problem, because of that most of the unit office are in rural area for that reason bank can’t contract with unit office by online.
Chapter -5 Conclusion & recommendations BRAC Bank Limited is proving itself as the fastest growing bank only in 9 years of its journey and showing remarkable progress of its financial position with the mission of being countries leading bank providing world-class services in a cost effective manner. This bank first introduces the SME loan in commercial banking sector, which help the people of poor society both in rural and urban. One thing can be noted that time horizon is too little to