Galle District Banking Clinic to facilitate credit access for micro and small industrialists

Monday, 28 July 2014 00:00 - - {{hitsCtrl.values.hits}}

A Banking Clinic for micro and small Industrialists to facilitate access to credit was organised by the Ministry of Traditional and Small Enterprise Development on 24 July at the District Secretariat, Galle. The Mahinda Chintana – Vision for the Future recognises banking clinics as an important development strategy to strengthen micro and small industrialists, and it plays an important role to facilitate access to credit. The banking clinics were initiated under the guidance of Minister of Economic Development Basil Rajapaksa under the Divi Neguma Cottage Industrial Program and are being carried forward to support all micro and small industries at the district level by the Ministry of Traditional Industries and Small Enterprise Development under the chairmanship of the Minister Douglas Devananda. 15 state and private banks and 700 micro and small industrialists participated.

At the banking clinic, over 15 state and private banks participated in order to provide concessionary credits to more than 700 micro and small industrialists. Credit was offered by the banks through the Central Bank supported refinancing credit schemes which are provided to micro and small enterprises at low interest rate and with more flexible collateral arrangements. The viability of the projects including entrepreneurship capabilities, marketable products, cash flows, local market and export potentials are considered more importantly rather than mere collaterals arrangements. Secretary, Ministry of Traditional Industries and Small Enterprise Development V. Sivagnanasothy, District Secretary, Galle V. Ravindra Hewavitharana, Director of the Ministry M.C. Gamage, PIM Program Coordinator Dr. Lloyd Fernando, Senior Assistant Director of the Central Bank Keethi Dunuthilaka, Director Planning, District Secretariat, Galle Pushpa Malalasekara and many others participated in the event. The Galle district banking clinic was well attended by many state and private sector banks including Bank of Ceylon, Regional Development Bank, People’s Bank, Sampath Bank, Sanasa Bank, Commercial Bank, Hatton National Bank, Nations Trust Bank, Seylan Bank, National Savings Bank, DFCC Bank, Cooperative Samurdhi Bank and Sri Lanka Savings Bank.

Concessionary credit for micro and small industrialists Over 700 micro and small industrialists who were trained in various sectors such as food and beverages, garments, footwear and leather products, joss sticks, rugs, sewing, candle, broomsticks, handicrafts, wood based products, mushroom, Batik, Mosquito nets and horticulture were linked with banks to obtain concessionary credits for their enterprise development. Beneficiaries were supported by the relevant implementing agencies such as Industrial Development Board, Industrial Technology Institute, National Craft Council, National Design Centre and Vidhatha Centre in the preparation of project appraisal forms and recommended proposals are submitted at the banking clinics to facilitate to access credit under the various concessionary SME credit schemes. Secretary, Ministry of Traditional Industries and Small Enterprise Development V. Sivagnanasothy stated that the 2014 budget speech by President Mahinda Rajapaksa had proposed the implementation of a women microenterprise credit guarantee scheme with the Regional Development Bank to provide working capital loans up to Rs. 250,000 without requiring securities on an interest basis. This scheme is currently being implemented successfully covering many micro and small entrepreneurs. Moreover, to promote small craftsmen, a revolving fund is being established with the support of the Ministry of Finance and Planning to provide credit against confirmed supply orders from reputed buyers to meet working capital requirements. Sivagnanasothy revealed that already banking clinics have been conducted island-wide in 17 districts namely Colombo, Gampaha, Jaffna, Anuradhapura, Hambantota, Kegalle, Puttalam, Kandy, Ratnapura, Badulla, Monaragala, Mannar, Kalutara, Kurunegala, Matale, Polonnaruwa and Nuwara Eliya and over 3,700 industrialists were linked with banks to obtain credit. The Secretary further said that these banking clinics will be expanded to other districts as well in the near future as it has been proved to be a successful initiative well received by the micro and small industrialists and the banking community. Many SME surveys have indentified that the access to credit has been one of the major problems for many years. The Government’s budget proposals and the banking clinics are contributing significantly to address the issues of access to credits by the micro and small enterprises.