Jan 06, 2020 (LBO) – Central Bank Governor Professor W D Lakshman urged Sri Lanka’s banking sector to rethink its credit disbursement policies, as the traditional ‘risk averse’ mindset has deprived emerging entrepreneurs and new ventures of much needed initial capital.
Announcing the road map of the Central Bank for this year, Lakshman said credit schemes that take into consideration the specific challenges faced by startups have failed to develop.
"The absence of dedicated development finance institutions is felt strongly, particularly at a time when the SMEs require support from the banking sector for survival during the phase of economic downturn as well as during the period of their takeoff," he said.
"A relief package for reviving SMEs is being designed, particularly targeting non performing advances.
buy xenical Canada buy xenical no prescription
For those who seek relief under this package, suspension of legal action and rescheduling of loans along with some interest rate concession have been proposed."
The revival of businesses of such borrowers is expected to be facilitated through a grace period for capital repayments and a short term working capital loan.
For borrowers in the performing category, a new facility with extended repayment periods including a grace period for capital repayments under reasonable interest rates is being considered.
Meanwhile, the Central Bank expects to review the caps on lending rates, once the financial institutions meet the stipulated reduction in lending rates and credit flows normalise during the year.
The growth of credit to the private sector is expected to pick up to around 12-13 percent by the end 2020.
press_20200106_road_map_2020_e