PROPARCO reasserts its commitment to the development of SMEs in Sri Lanka [fr]
PROPARCO, a subsidiary of Agence Française de Développement (AFD) dedicated to private sector financing, is supporting a major player in financing Sri Lankan small and medium-sized enterprises through a USD 25m loan allocated to Commercial Bank of Ceylon (CBC), the leading private bank in Sri Lanka.
PROPARCO is supporting a major player in financing Sri Lankan small and medium-sized enterprises through a USD 25m loan allocated to Commercial Bank of Ceylon (CBC), the leading private bank in Sri Lanka.
Small and medium-sized enterprises (SMEs) are the backbone of Sri Lanka’s economy. They make up about 75% of the total number of companies in the country and account for almost half of employment and GDP in the country.
Despite the key role they play in the national economy, Sri Lankan SMEs experience major difficulties in obtaining credit, which has a significant impact on their capacity to invest, recruit and grow. Supporting SMEs is consequently central to the Sri Lankan Government’s economic development strategy.
Commercial Bank of Ceylon (CBC) was set up in 1920 and is the leading private bank in Sri Lanka. It is today the leader in financing entrepreneurs and SMEs, thanks to its products tailored to the needs of SMEs. CBC has also stood out in recent years for its skills development program, which has benefitted to over 2000 entrepreneurs since 2015. The bank has also launched a program for women entrepreneurs, which has already been followed by 850 of them.
Bank has also established 16 Agriculture and Microfinance Units (AMFU) around the country to groom micro entrepreneurs the future SMEs by providing continuous financial and non-financial services. Annually Bank conduct capacity building/financial literacy programmes to over 1000 micro entrepreneurs as non-financialservices. By allocating a USD 25m loan to CBC, PROPARCO is reasserting its support to SMEs in the country after many other credit lines targeted towards this key segment of the economy. This new long-term financing is expected to create or support over 5,000 jobs in Sri Lanka.
This operation is in line with PROPARCO’s commitment to support access to finance for SMEs in developing countries and emerging economies.
Over the last ten years, Proparco’s parent company, the French Development Agency, has committed 600 million EUR to sustainable projects in Sri Lanka in key development sectors including water and sanitation, urban development, energy, and irrigation. With this project, AFD Group’s investments in the country will cross 850 million euro.