‘Enterprise Sri Lanka’ launch in March: Mangala

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By 2018-01-12

Minister of Finance and Mass Media Mangala Samaraweera said, one of the main proposals made in the Budget to create entrepreneurs would be launched in March, stated a press release. He further said that those who obtain credit facilities would be given interest subsidies of up to 75% of the effective interest rate.

The Government expects to disburse Rs 60,000 million through State and private banks to would-be entrepreneurs, while another Rs 5,000 million has been set aside by the Treasury to reimburse the interest subsidy to the banks, the release added. Under this scheme, 15 different loan schemes have been proposed for young entrepreneurs in the fields of Agricultural and Fishery industries, and for small and medium enterprises. This scheme includes journalists and those who are self-employed as well.

In addition to young entrepreneurs, women and differently-abled persons will also be provided the opportunity to participate in this programme, offered additional interest subsidies of 10% and 15% more, respectively. To be eligible, women will have to have started a company with at least ten equity shareholders, of which each shareholder should have invested at least Rs 10,000. The Government will extend a comprehensive support package - which includes both non-financial and financial assistance, including grants and credit through the Enterprise Sri Lanka credit schemes – to these companies.

Samaraweera held a discussion yesterday with the Heads and the Chief Executive Officers of State and private banks at the Treasury. State Minister of Finance Eran Wickremaratna and Ministry officials also participated at this discussion.
Samaraweera called upon all banks to extend their fullest support to implement this Government programme to create new jobs through the expansion of the economy, while aiming to expand 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 and SMEs.

However, the Minister stated, "Our objective is to ensure that no entrepreneur is ever denied credit due to the lack of collateral, but is able to access financing given viability of the project proposals."

The heads of State and private banks assured the Minister of their continuous support to this project to realize the Government's objectives of creating one million new jobs, increasing the per capita income, and expanding exports through the Enterprise Sri Lanka programme, proposed to begin in March.

When entering the field to expand the small and medium scale business sector, including self-employment, the Minister informed bank officers that the Government would not allow banks to repay the loans because of the impossibility of bailing to obtain capital costs and loans.

As the Treasury has decided to hand over the bails expected by the banks from businessmen, the Government has hereafter decided to issue a Treasury bail for debtors to give loans on concessional interest basis, by considering only the feasibility of the project proposal.

With the aim of obtaining female participation in the field of business and industry, women who join the Enterprise Sri Lanka programme will be given an interest relief of 10% in addition to 75% interest relief when granting a loan, and 15% surplus interest relief for specially-skilled individuals will be provided by the Government with a Treasury bail as decided.
The Government will provide non-financial technical facilities for companies in which women have a greater share and include at least 10 participants, started with a minimum capital of Rs 10,000 from each shareholder.

The Government will hold 75% of the leasing cost of the machinery obtained under the leasing method by such companies, while the Treasury will issue the required bail for the relevant banks.

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