A Comparative Rural Development Scheme of Islami Bank Bangladesh Limited and Grameen Bank: Finding a Cost Effective Institutional Mechanism to Rural Development for the Emerging Economies

There is growing need that economic development should focus rural development to be sustainable & meaningful in the countries, territories or conveyances where majority of the population live in the villages or semi urban clusters. It is especially important in the traditional Muslim societies where the value system plays a vastly and valuable dominant role. Bangladesh is a country with more than 90% of its population are Muslims. It stands as the fourth-largest Muslim-populated country and “the constitution of Bangladesh declares Islam as the state religion”. There is a famous maxim “Familiarity breeds confidence” Islami Bank Bangladesh Limited (IBBL) is an institution that is Muslim faith based and engaged in rural poverty reduction program through its instrumentality RDS (Rural Development Scheme). The main aim of the study is to confirm that Shariah based banking through its cost effective outreach to rural development is efficient than contemporary microfinancing. The method used is to compare & contrast the secondary data for financial information of both Islami Bank Bangladesh Limited (IBBL) & Grameen Bank (GB) that supports the above assertion.