Bhutan Development Bank Limited (BDB) was incorporated by the Royal Charter, in January 1988, with assistance from the Asian Development Bank (ADB) to function as a development finance institution (DFI). BDB is registered as a company under the Companies Act (2000) and licensed under the Financial Institutions Act 1992. BDB now functions as a domestic development bank with cheque facilities after obtaining its banking license in March 2010.

BDB is the only Bank that gives focus to the rural farmers and immediately assumed responsibility for the nation-wide credit program, which mainly provides seasonal, small, and medium-term loans to the country’s small farmers. It had also commenced its Industrial Lending operations, providing term finance and working capital for industrial and agro-based ventures. Farmers Outreach banking was also introduced to the clients in the rural areas, where the field officers visit the farmers for loan disbursement, collection, deposit, withdrawal, etc., at fixed periods, places, and times. The clients in the rural areas can save their expenses by coming to the branch office. The Royal Government of Bhutan (RGoB) owns 96% of its paid-up share capital.