ADB approves $100m to expand affordable housing finance in Bangladesh

The Asian Development Bank (ADB) has approved a $100 million concessional loan to expand access to affordable and resilient housing finance for low- and middle-income borrowers in Bangladesh, particularly women.

The fund will be provided under a project through Palli Karma-Sahayak Foundation (PKSF) and microfinance institutions (MFIs). The long-term, collateral-free microfinance loans will help families construct, repair and upgrade their houses.

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The project will address a significant shortage of safe and affordable housing and limited access to housing finance for households with informal incomes that are not typically served by conventional mortgage lenders, said the ADB.

“Housing is a critical foundation for dignity, opportunity, and resilience,” said ADB Country Director for Bangladesh Qingfeng Zhang. 

“By helping low- and middle-income families, especially women, invest in safer and more resilient homes, this project will contribute to Bangladesh’s broader goals of reducing poverty, strengthening social protection, enhancing human development, and fostering more inclusive and sustainable economic growth.”

By 2031, the project is expected to provide loans to at least 40,000 households, including at least 32,000 women and at least 24,000 borrowers residing in areas vulnerable to natural hazards.

It will promote financial and land literacy, as well as awareness of housing rights, while enhancing housing security for women through strict documentation of borrowers’ spousal residency arrangements.

To strengthen resilience and ensure the long-term expansion of housing microfinance nationwide, the project will integrate design, construction and shock-protection measures to make houses better withstand flooding, cyclones, extreme heat and other impacts of disasters and extreme weather events.

The financing includes $40 million from ADB’s climate adaptation financing and is supported by an additional $600,000 in technical assistance grants.