Government to introduce concessional loan package for MSMEs

 

he Development Finance Department is set to launch a concessional loan package for micro, small, and medium-scale entrepreneurs, in line with government directives, Fiscal Policy Department Director General Manjula Hettiarachchi said.

Addressing a media briefing, Hettiarachchi highlighted the significant contribution of entrepreneurs to the country’s GDP and outlined the government’s plan to allocate Rs. 95 billion for concessional loans this year. “We aim to earn export income of up to 36 billion dollars by 2026. Small and medium-scale enterprises play a crucial role in achieving this goal, and providing them with the necessary support is a priority,” he said.

The loans, offered in collaboration with the banking sector, will include a special scheme titled “RE-MSME – Disaster Relief”, designed to assist entrepreneurs affected by Cyclone Ditwah and the ongoing economic crisis. The scheme targets around 130,000 entrepreneurs and offers financial relief through concessional interest rates of 3% per annum.

Under the scheme, micro-scale entrepreneurs can access loans of up to Rs. 250,000, while small and medium-scale entrepreneurs are eligible for loans of up to Rs. 1 million. Loans will be repayable over three years (36 months) with a six-month grace period, allowing recipients time to stabilise their businesses before repayment begins.

Hettiarachchi highlighted that only registered or formally maintained businesses will qualify for the facility. Entrepreneurs can access the loans through participating banks, including the People’s Bank, Bank of Ceylon, and the Regional Development Bank, among others.