Government’s Special Loan for SMEs to Contribute to Economic Recovery

Government’s Special Loan for SMEs to Contribute to Economic Recovery

Government’s special loan for small and medium enterprises (SMEs) both for processing, handicraft and agriculture sectors will contribute to the economic recovery during and after this COVID-19 crisis.

The special loan is cumulatively about US$650 million which the government decided to provide to the SME sector through state-owned SME Bank, Agriculture and Rural Development Bank (ARDB), and 33 partnered commercial banks.

Mr Ros Silva, Secretary of State for Economy and Finance, said that US$50 million was allocated to SME Bank, US$50 million to ARDB, and other US$50 million to 33 partnered commercial banks.

The government is planned to allocate US$500 million as new financial package to help the SME sector in accessing financial services, he said at a press conference held on July 30 at the Office of the Council of Ministers.

Some US$200 million of the total amount will be given to soon-to-be established Credit Guarantee Corporation, aimed to help SMEs particularly enterprises without collateral or with inadequate collateral and track record to obtain financing from financial institutions, he continued.

The government planned to provide another US$300 million, which will be allocated to partnered commercial banks to provide credit to SMEs or other sectors that need credit to help the economic recovery, he added.

“These US$650 million will help sustain the economy, especially to survive in the hard time of COVID-19 pandemic and be ready for recovery once the crisis comes to an end,” Mr Ros Silva underlined.

The government announced the special fund to help SME sector since the outbreak the COVID-19 pandemic, with an aim to boost local processing and production by using raw materials from agriculture to supply local demand and for export.

According to the SME Bank, US$20 million has been disbursed to the SME sector as of July 30.

The ARDB has also provided credit of US$10 million to agriculture-based SMEs.