The government has decided to grant financial facilities for eight new loan schemes, thereby further widening the government’s interest-subsidised Enterprise Sri Lanka loan scheme that targets to create 100,000 entrepreneurs in the country
within a year.
The proposal submitted by Finance Minister Mangala Samaraweera to further broaden this loan scheme has been approved by the Cabinet of Ministers.
The minister made the proposals for this loan scheme initially in the 2019 national budget.
The ‘Ran Aswenna’ loan scheme, which targets the productivity of agriculture, has now been extended to cover the development of the tourism industry. Accordingly, those who are in the tourism sector can purchase the equipment required for the water-based tourism sector, such as motor boats and other apparatus required for water-based leisure activities. This loan could be obtained up to a maximum sum of Rs.250 million.
The ‘Riya Shakthi’ loan, which is meant to provide loan facilities to school van service owners to purchase buses, has now been extended to include the school van operators at district level, on the recommendation of the district school van operators’ associations.
A Rs.5 million housing loan, which was granted earlier under the medium-income housing loan scheme, has been replaced with the ‘Home Sweet Home’ loan scheme, by increasing the loan ceiling up to Rs.10 million. This loan could be repaid within 25 years and the borrower has to pay only 6 percent of the interest. The previous five-year relief on the interest has been extended to 15 years.
The ‘Sihina Maliga’ loan scheme was implemented to enable the Sri Lankans serving in foreign countries to build houses here. Many such expatriate workers enter into short-term agreements of about two years and it is not possible to grant them a maximum loan of Rs.10 million to be paid within a period of 15 years. Therefore, under the new amendment to the scheme, it has been proposed to grant this loan under several stages and the loan will also be granted to purchase housing units from condominiums. This loan will also be granted to build a new house, renovate the existing house, demolish the current house and build a new house, purchase a land and put up a house there and purchase an old house and renovate that house.
A five-year grace period has been given for the borrowers of the ‘City Ride’ loans to repay their loans and among them, those who currently own route numbers or the others who provide transport facilities for export-based institutions, do not need such a grace period.
The ‘Jaya Isura’ loan scheme is the main product under the Enterprise Sri Lanka loan scheme that expects to create entrepreneurs and it provides loans for those who engaged in businesses, which are related to information technology, innovation and to broaden their existing businesses.
The loan amount provided to purchase mini taxies and electronic three-wheelers has been increased by Rs.250,000. This has been amended following the vehicle price increase and the current maximum loan amount is Rs.2.25 million. The ‘Mage Anagathaya’ loan scheme has been introduced to facilitate those who fail to enter state universities. With this loan, they can continue their higher education at private universities. A loan of Rs.1.1 million will be provided under this scheme. The Average Weighted Prime Lending Rate of + 2 percent in this regard is changed. At the same time, if the loan applicant fails to repay such a loan, which was obtained to complete a degree or a course from a private university or an institute or on the occasions that the applicant reasonably fails to repay the loan, the respective loan amount should be charged from the degree applicant or his or her guarantors.
If it fails to charge the loan amount in that manner, the government should pay the outstanding balance of the loan together with its accumulated interest to the relevant bank.
There are 22 relief loan schemes implemented under the Enterprise Sri Lanka loan schemes, introduced by the government. Among them are 17 loan schemes under relief interest, three reimbursable loan schemes and two non-monetary programmes.
Nearly Rs.81 billion of loans have already been approved under the relief interest loan scheme and Rs.55 billion have been granted as loans by the state and private banks.