Formal activity based Micro--credit has good reputation in the society from the very beginning of Modern Baking system. More or less it played a positive rule in the rural Advancement. Its interest rate is enough lower and repayment schedule is flexible. Depending on the natural crises or disasters it frequently waives the interest, it has also history of remission of the Principal loan Amount up to a certain ceiling. Formal activity based Micro--credit has still great demand and existing facilities are still inadequate.

Micro--Credit Program was started from Bangladesh from early eighties with conception of small credit, high recovery with tremendous profit. The Entrepreneur started his feasibility study in a remote village of Hill tracts district with his own small money. He distributed the money among very poor people with backward know--how, illiterate and week social existence. Mainly the lower custom’s working classes were the target group. The entrepreneur was with a signboard of teacher with a strong influence on that locality. Like a feudal Lord of this century, he was capable to get recovery of his divestments with full profit on daily basis. The borrowers were really sufferer; they have to refund the loan by selling out their households. The entrepreneur was also annoyed with the borrowers and became dishearten.

The next year for vicious circle of poverty and lack of institutional finance, the borrowers again came to the entrepreneur. He saw the light of hope. He asked the borrowers to say that his previous finance was really helpful for them and they led micro scale economic activity and generated profit. He also imposed condition to mobilize more groups of borrowers. That was also done successfully.

The entrepreneur then formed an institute naming Rural Banking. He then knocked the donor agencies and development partners to finance him with approach of poverty eliminating initiative. In Bangladesh the Banking sector has a very low recovery rate. So the approach of one hundred percent recovery rate was really convincing. The project was financed and started operation Countrywide.