Government’s loan scheme to support entrepreneurs to be launched in March

• Govt. expects to disburse Rs.60bn through state and private banks to would-be entrepreneurs
• Rs.5bn set aside by the Treasury to reimburse interest subsidy to banks
• Finance Minister holds discussion with top state and private bank officials

Finance and Mass Media Minister Mangala Samaraweera said that one of the main proposals made in the budget to create entrepreneurs under the ‘Enterprising Sri Lanka’ programme would be launched in March. 

He said those who obtain credit facilities under this programme would be given interest subsidy up to 75 percent of the effective interest rate.

The government expects to disburse Rs.60 billion through state and private banks to would-be entrepreneurs and another Rs.5 billion has been set aside by the Treasury to reimburse the interest subsidy to the banks.

Under this programme 15 different loan schemes have been proposed for young entrepreneurs in the fields of agro, fishery industries and for small and medium enterprises. This programme includes journalists and those who are self employed as well.

In addition to young entrepreneurs, women and differently abled persons will also be provided special opportunity to take part in this programme. 

Women and differently abled persons who come forward to take part in this programme will be offered additional interests subsidy of 10 percent and 15 percent, respectively. 

The government will extend a comprehensive support package, which includes both non-financial and financial assistance including grants and the credit through the Enterprise Sri Lanka programme to these companies.

Minister Samaraweera held discussions yesterday with the heads and the chief executives officers of the state and private banks at the Treasury. State Finance Minister Eran Wickremarathna and ministry officials also participated in the discussions.

The minister called upon all the banks to extend their fullest support to implement this programme, to create new jobs through the expansion of the economy while aiming to expand the exports.

The government expects the SME sector to be the backbone of the economy. However the lack of capital or the difficulty in accessing capital due to both the cost of capital and the requirement for collateral have been the main impediments in the development of startups of the SMEs.

However, the minister stated that the government’s objective is to ensure that no entrepreneur is ever denied credit due to lack of collateral and be given access to finance on the soundness of his or her business proposal.