Major purpose of this report is to discuss SME Banking and Credit Risk Management Policy of Prime Bank. Other objectives are explain the concept of SME and its impact in overall economy of Bangladesh andmportance of SME Banking in context of Bangladesh. Here also discuss to familiar with SME loan procedures understand the terms and conditions of SME loan. Report also focus on various types of credit disbursed by Prime Bank and understand the credit risk grading system and analyze the credit recovery performance of this bank. Finally suggest some recommendations for development of SME loan products.