The Impact of SME Financing on Beneficiary Households: An Empirical Study from Kushtia District, Bangladesh

This study investigates the socioeconomic impact of Small and Medium Enterprise (SME) financing on borrower households in the Kushtia district of Bangladesh. Given SMEs’ critical contribution to national GDP and employment, the research examines how formal credit—particularly from commercial banks—affects borrowers’ income, asset accumulation, occupation, savings, employment, and overall financial well-being. Using primary data from 120 SME borrowers (67 new and 53 repeat), the study adopts a structured questionnaire and employs descriptive statistics, t-tests, and multiple regression analysis for data interpretation. Results show that SME financing positively influences household income, with repeat borrowers reporting higher gains in income, savings, and asset ownership. Though differences in asset categories (household, productive, and livestock) exist between groups, they are not statistically significant. Employment generation was modest, with over 43% reporting increased employment, and occupational shifts were minimal.