President Ranil Wickremesinghe announced a Rs 13 billion financial aid package for micro, small, and medium-scale enterprises (MSMEs) in Sri Lanka. This initiative includes both investment and working capital facilities to support MSMEs ahead of local elections.
The scheme offers loans at a concessional interest rate of 7% for a period of 10 years, with a maximum limit of Rs 15 million. MSMEs under the non-performing loans category can receive a working capital loan of up to Rs 5 million for 5 years at an 8% interest rate. The total allocation for this initiative is Rs 5 billion.
“Strengthening MSMEs is crucial for the country’s progress,” stated Wickremesinghe. A National Development Bank will also be established to provide necessary capital to MSMEs.
Fifteen financial institutions will offer these subsidized loans, including Bank of Ceylon, People’s Bank, Regional Development Bank, State Mortgage and Investment Bank, Hatton National Bank, Seylan Bank, Sampath Bank, Commercial Bank, DFCC Bank, National Development Bank, Nations Trust Bank, Sanasa Development Bank Limited, Union Bank, Pan Asia Bank, and Cargills Bank.
“This initiative supports MSMEs that have maintained operations despite the ongoing crisis,” said the PMD. The Ministry of Industries will issue recommendation letters to eligible MSMEs that need financial support and have the potential to advance their businesses.
The scheme focuses on enhancing MSME resilience as they recover from the economic crisis and address risks from changes in the business environment, including climate change. Special attention will be given to sectors such as agriculture, tourism, manufacturing, technical and export-oriented industries, and women-led MSMEs (excluding trading, leasing, and business rental) requiring working capital financing.