ADB helps DFCC to fund MSMEs | Sunday Observer

ADB helps DFCC to fund MSMEs

MSMEs are an important part of Sri Lanka’s economy
MSMEs are an important part of Sri Lanka’s economy

The Asian Development Bank (ADB) and DFCC Bank PLC (DFCC), a leading commercial bank in Sri Lanka, signed a $35 million loan agreement recently, to improve access to finance for the country’s Micro, Small, and Medium-sized enterprises (MSMEs).

DFCC Bank’s Executive Director and CEO, Lakshman Silva and ADB Senior Investment Specialist Biao Huang signed the agreement in the presence of DFCC Senior Vice President, Treasury and Resource Mobilisation, Kapila Nanayakkara and Assistant Vice President, Treasury and Resource Mobilisation, Channa Dayaratne, in Colombo.

“MSMEs are an important part of the Sri Lankan economy. It is crucial that they have sufficient access to finance to further boost their contributions to growth and development,” ADB’s Private Sector Financial Institutions Director, Christine Engstrom said.

“The ADB’s loan to DFCC will open these financing opportunities to MSMEs in Sri Lanka, providing more jobs and economic opportunities,” he said.

“DFCC Bank is proud to partner with the ADB again to empower the MSME sector in Sri Lanka,” DFCC Bank’s Executive Director and CEO, Silva said.

“The credit line will help DFCC continue its mission to nurture small and medium businesses. The bank has domain expertise in the SME sector. I believe ADB funding support comes at a crucial time in the country’s economic growth.”

Nearly all enterprises in Sri Lanka are MSMEs, contributing a significant share of employment and Gross Domestic Product. Access to finance for MSMEs has been constrained by stunted growth and development which is compounded by financial reporting quality issues of MSMEs, and a risk-averse culture among financial institutions.

The ADB’s loan will enable DFCC to diversify funding sources and gives long-tenor funding to finance loans to MSMEs in Sri Lanka. A portion of the loan will be used to support MSMEs owned or managed by women. At least 20 percent of ADB’s funding will be On-lent to businesses outside Colombo. DFCC Bank PLC is a commercial bank offering the full range of commercial and development banking services. The Chartered Institute of Management Accountants (CIMA) and the International Chamber of Commerce of Sri Lanka (ICCSL) has named the DFCC Bank as one of the ten ‘most admired companies’ in Sri Lanka, for 2018. 

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