ComBank gets US$ 25mn Proparco loan to support local SMEs
- SMEs make up about 75% of SL’s companies
- AFD Group’s investments in SL cross EUR 850mn
Proparco, a subsidiary of the Agence Française de Développement (AFD) Group, dedicated to private sector financing, recently signed an agreement with Sri Lanka’s Commercial Bank of Ceylon PLC to support the island nation’s small and medium-sized enterprises (SMEs).
Through this agreement, Proparco will allocate a US$ 25 million long-term loan to Commercial Bank to be utilized to finance Sri Lanka’s SMEs.
SMEs make up about 75 percent of the total number of companies in Sri Lanka and account for almost half of employment and GDP of 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 Sri Lankan government’s economic development strategy. This new long-term financing is expected to create or support over 5,000 jobs
in Sri Lanka.
Commercial Bank 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
SME needs.
The bank has also stood out in recent years for its skills development programme, which has benefitted to over 2000 entrepreneurs since 2015. The bank has also launched a programme for women entrepreneurs, which has already been followed by 850 of them.
Further, Commercial Bank has 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 the bank conducts capacity building/financial literacy programmes to over 1000 micro entrepreneurs as non-financial services. Over the last ten years, AFD Group has committed EUR 600 million 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 EUR 850 million.