Asian Development Bank (ADB) Country Director for Sri Lanka, Takafumi Kadono, recently visited ADB-aided small and medium-sized enterprises (SMEs) in Kandy. Kadono expressed his admiration for the success of these projects and committed to providing further support for Sri Lankan SMEs.
The ADB has successfully completed the disbursement of the Small and Medium-Sized Enterprise Line of Credit project (SMELoC), which has been operational since 2016, amounting to approximately $350 million. By the end of June 2024, 10,380 SMEs in Sri Lanka had benefited from the SMELoC loan, with over 33% of these being women-led SMEs (WSMEs). Additionally, 1,553 WSMEs received the Women Entrepreneurs Finance Initiative (We-Fi) grant blended with the SMELoC loan.
In May 2024, the ADB approved a USD 100 million loan to support SMEs through two components: a new SME line of credit (USD 50 million) for those affected by the economic crisis to provide emergency working capital (SMELOC2 component), and a USD 50 million loan to the government for an equity infusion into the National Credit Guarantee Institution Limited (NCGI), which will offer partial credit guarantees (PCGs) on loans to SMEs with inadequate or no collateral (PCG component).
Moreover, the ADB and the Sri Lankan government signed a USD 100 million loan agreement for subprogram 1 of a policy-based loan (PBL) aimed at enhancing the financial sustainability of the country’s power sector. This loan is part of a broader programmatic approach PBL, consisting of three subprograms totaling USD 300 million, dedicated to transforming the power sector.
The ADB remains committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while continuing its efforts to eradicate extreme poverty. Established in 1966, the ADB is owned by 68 members, 49 of which are from the region.
The National Credit Guarantee Institution Limited (NCGI) will be launched this year with an initial USD 50 million infusion by the ADB, according to Country Director Takafumi Kadono. The NCGI aims to help SMEs in Sri Lanka overcome longstanding collateral barriers.