SMEs to get better access to finance through ADB loan
Small and Medium-sized Enterprises (SMEs) located in Sri Lanka's
areas affected by terrorism and the tsunami, where unemployment is high,
will soon have better access to finance to start or expand businesses,
after the Asian Development Bank (ADB) signed a $15 million loan with
Nations Trust Bank last week.
"As the economy continues its robust growth, SMEs' demand for finance
has steadily increased. However, SMEs are experiencing difficulties
accessing funding, particularly longer-term," said Investment Specialist
in ADB's Private Sector Operations Department, Monisha Hermans.
"Providing financing opportunities will help reach underserved customers
and close the funding gap."To promote inclusive financial development,
Nations Trust Bank will extend the life of its loans from the current
average of 2.25 years to up to five years. A minimum of 50 percent of
loans will be offered to entrepreneurs outside Colombo, of which 30
percent will focus on SMEs based in terrorism and tsunami-hit areas in
the North, East and South.
About 20 percent of the facility will target women borrowers.The loan
will improve financial inclusion by setting lending targets. ADB
proceeds will be open to SMEs with a turnover not exceeding Rs. 600
million.
The loan will be disbursed in two tranches to help Nations Trust Bank
better manage its growth. |