“A loan isn’t just cash. It’s a sign someone believes your business will make it.”
Let’s Talk About Money (The Borrowed Kind)
So, your company’s registered. You’ve got your trade license. Maybe you’ve even opened a business bank account for your company. Now comes the real question:
Can you get a business loan from a Bangladeshi bank as a foreign entrepreneur?
Some types of loans—especially foreign currency loans—require patience, approvals, and more paperwork than you’d expect. But if your structure is right, they’re doable.
Because here’s the thing: Bangladesh doesn’t have a big red button that says “FOREIGN ENTREPRENEUR LOAN – CLICK HERE.” But if your business is properly set up, and your papers are in order, the door isn’t locked. It’s just slightly ajar. You need to know where to push.
What You’ll Need to Be Taken Seriously
Let’s not overcomplicate it. Here’s what you’ll need before any bank even looks at your file:
- A registered company (ideally a Private Limited one)
- BIDA approval (especially if you’ve invested foreign currency, see: How to Get BIDA Approval in Bangladesh as a Foreign Investor)
- A valid trade license and TIN
- A proper business address (more on that: How to Lease or Buy Office Space in Bangladesh as a Foreigner)
- An actual relationship with the bank you’re applying to
Don’t underestimate that last one. Most loans happen because the banker knows your name before the paperwork lands on their desk.
Do You Need a Local Director or Shareholder to Apply for a Loan?
Short answer? Sometimes, yes. And sometimes… not officially, but practically.
Most Bangladeshi banks aren’t just looking at your documents. They’re quietly asking, “Who is actually running this business? And can we reach them if something goes wrong?”
So, even if there’s no written rule that says “You must have a local director or shareholder,” many banks feel more confident if someone local is involved—especially if your company is brand new or entirely foreign-owned.
Here’s what that might look like:
- A local director listed in your RJSC records
- A local authorized signatory who can sign contracts and receive official correspondence
- Or, in some cases, a local shareholder—even if it’s a minor stake—to signal domestic accountability
This isn’t about excluding foreign entrepreneurs. It’s about reassuring the lender that your business is rooted here—and that they won’t be chasing signatures across borders if things get complicated.
It’s one of those “not in the brochure” things you learn only after your first bank meeting. So if you’re structuring your company now, and you think a loan might be in your future—plan for a local presence. Even if it’s strategic, not operational.
Pro Tip: Check our blog, Top Legal Requirements for Foreigners Starting a Business in BD, and Company Types & Restrictions for Foreigners in Bangladesh—because legal obligations and structure always come before money.
Is a Local Director or Shareholder Really Required to Get a Loan?
Let’s break this down clearly.
Legally?
No. There’s no official law that says you must have a Bangladeshi director or shareholder to apply for a business loan as a foreign entrepreneur.
Practically?
Yes! Most banks in Bangladesh prefer it, especially when you’re applying as a foreign-owned or newly formed company.
Then, Why Do Banks Want Local Involvement?
Because they want accountability on the ground.
Someone they can:
- Contact quickly
- Call into meetings
- Hold responsible if there’s a repayment issue
It’s not about gatekeeping. It’s about risk management and simple communication.
This Becomes Especially Important If:
- You are applying for an SME loan as a foreign entrepreneur
- You want a term loan under standard local banking rules
- Your company has no physical or operational base in Bangladesh yet
The Safer Move?
If you’re serious about applying for a loan, consider having:
- A local director listed in the RJSC
- A nominee director for banking representation
- Or even a minor local shareholder to signal local presence
It’s not mandatory by regulation, but it often makes the difference between “We’ll get back to you” and “Let’s move forward.”
What Kinds of Loans Are Even on the Table?
You’re not getting a blanket “entrepreneurship” loan just because you have a pitch deck and optimism. But there are specific products you can apply for:
- Working Capital Loans
Available from local banks for short-term business needs—inventory, salaries, logistics.
- Term Loans
Want to buy equipment or build a facility? These are long-term loans tied to specified aims.
- Foreign Loans (via BIDA)
These are strictly regulated and can’t be used for working capital, payroll, or daily expenses. They’re meant for long-term development—think importing capital machinery, infrastructure build-outs, or project expansion.
Just a heads-up: foreign loans aren’t a general-purpose solution. You can’t use them to pay salaries, cover day-to-day expenses, or plug short-term gaps.
Working capital? Off the table.
What they are meant for:
- Importing capital machinery
- Project expansion
- Infrastructure build-outs
And yes, this is enforced. If you apply for a foreign loan and list “monthly payroll” as the purpose, you’ll get shut down quickly.
Foreign Loan Approvals: What Happens Behind the Curtain
If you’re applying for a foreign currency loan, it goes through more than just BIDA.
Here’s the chain:
- First, you submit to BIDA
- Then, it moves to a Scrutiny Committee, chaired by the Governor of the Bangladesh Bank
- If cleared, final approval comes from the Bangladesh Bank
It’s layered, yes—but not impossible. As long as your project is aligned with approved loan purposes and your structure is compliant.
So… How Do You Actually Apply?
Here’s how it usually works—cut and dry, with just enough detail to help you look like you’ve done this before:
- Get Your Documents Together
You’ll need your:
- Certificate of Incorporation
- Trade License
- TIN
- BIDA approval (if foreign investment is involved)
- Feasibility study, financial projections, and a Board Resolution approving the loan (especially for foreign currency loans)
- Undertaking from directors for Credit Information Bureau (CIB) clearance and a bank certificate showing creditworthiness
- Latest bank statements (if any)
- A solid business plan with projections
- And someone local—on paper
This last one surprises a lot of founders. Even if your company is 100% foreign-owned, banks often want to see a local director, authorized signatory, or at least a nominee who can represent the business within Bangladesh.
It’s not always written in the policy, but it’s definitely practiced. Having a local signatory makes the application feel less risky—and easier to process.
- Pick the Right Bank
Foreign banks in Bangladesh (like SCB or CBC) are usually more familiar with cross-border documentation. But even local banks can be great—if you’ve built some rapport.
- Apply Like You Mean It
Fill out the forms. Don’t just attach documents—explain why your business is structured this way, how the money will be used, and how you’ll pay it back. Bonus: Show existing revenue or contracts if you have them.
- Prepare for Questions
This isn’t a “submit and pray” process. Expect to answer things like:
- “Who runs your operations locally?”
- “Can we meet the authorized signatory?”
- “What’s your fallback if the project stalls?”
If you’ve built your company structure smartly and already sorted your filings (see: A Complete Compliance Guide for Foreign Entrepreneurs in BD), most of these won’t throw you off. You’ll be ahead of the game.
- Wait, Review, Negotiate
Banks do internal risk checks, credit assessments, and might ask for security or even personal guarantees. Some will also ask for a local guarantor, especially if your business is under a year old.
Be calm, be clear. This isn’t rejection—it’s just diligence.
EPZ Exception: A Shortcut If You’re Lucky Enough
If your business is set up inside an Export Processing Zone (EPZ) and is 100% foreign-owned, here’s some good news:
Foreign loans might not require prior approval from BIDA or Bangladesh Bank.
You can borrow directly from international lenders—just keep your reporting straight.
This doesn’t apply to general private limited companies, though.
If you’re outside an EPZ, full approval still applies.
Things No One Tells You—But Should
- Most banks won’t finance you if your capital is too low or your structure is unclear. So get your house in order before knocking.
- A good relationship with your bank manager is worth more than 10 pages of forecasts.
- If you’re dealing with foreign loans, compliance doesn’t stop after disbursement. You’ll have to regularly report to BIDA and Bangladesh Bank—or risk future penalties.
- Collateral is still a thing. Property, equipment, or deposit-backed assets can help you get approved faster.
- Many banks are open to SME lending—but only if you’ve got documentation, a plan, and a registered presence.
If You Want a “Yes,” Make It Easy to Say Yes
This isn’t about gaming the system. It’s about respecting how it works.
Loans aren’t handed out to strangers. They’re given to businesses that look like they belong. If your setup is clean, your numbers make sense, and your story checks out—you’re not asking for a favor. You’re applying for trust.
So take the time to structure your ask.
Because at the end of the day, the money might come from the bank—but the confidence has to come from you.
FAQ
Can a foreign-owned company apply for a loan in Bangladesh?
Yes—but only if your company is legally registered in Bangladesh. You’ll also need a valid trade license, TIN, and (in most cases) BIDA approval. And if you’re completely foreign-owned? A local signatory helps, even if it’s not mandatory.
Do I need a local director or shareholder to qualify for a bank loan?
Not by law. But most banks prefer it. A local person gives them someone to contact, verify, or involve if things get complicated. Think of it less as a legal requirement, more as a strategic move.
What types of loans can a foreign entrepreneur apply for?
The most common ones are:
- Working capital loans (short-term business needs)
- Term loans (long-term investments like machinery or property)
- Foreign loans (foreign currency loans for project-related expenses, subject to BIDA and Bangladesh Bank approval—not usable for working capital)
Can I apply for a startup loan as a foreigner?
It’s possible—but rare. Most startup or SME-focused loans are tailored toward locals. However, if your business has revenue, compliance, and a proper local setup, you can still make a compelling case.
Will I need collateral?
Often, yes. Banks in Bangladesh are still collateral-driven. Property, deposits, or assets can boost your approval odds, especially if your company is new.
How long does it take to get a business loan approved in Bangladesh?
If your documents are clean and your setup is strong, 2 to 6 weeks is common. But if you’re missing local representation or your compliance is shaky, it can take much longer—or stall entirely.
Which banks are more friendly to foreign entrepreneurs?
Foreign banks like Standard Chartered, CBC, or HSBC often understand international setups better. Local banks may work too—but they usually require more explanation and a stronger local presence.
Can I get a loan without BIDA approval?
If your company is 100% foreign-owned and registered under foreign investment, BIDA approval is typically required. Without it, most banks won’t move forward, especially for anything beyond a basic overdraft.
