SDB bank recently entered into a joint initiative together with the Asian Development Bank (ADB), to provide a line of credit (LoC) to selected small and medium-sized enterprises (SMEs) in Sri Lanka, including those led by women, are first-time borrowers, lack of sufficient collateral and those who are located outside of Colombo. The project also includes technical assistance (TA) for developing innovative financial schemes for SMEs and promoting export-oriented cluster development and developing an ecosystem for women entrepreneurship in Sri Lanka.
Both SDB bank and the ADB are well-known for their commitment towards SMEs, export-oriented businesses and women-owned and run enterprises. ADB is a key promoter for social and economic development in the Asia-Pacific region by providing loans, technical assistance, grants and equity investments, and is focused on its 2030 strategy to achieve a prosperous, inclusive, resilient and sustainable region, while sustaining its efforts to eradicate extreme poverty. As SDB bank has spent the last 25 years, supporting Sri Lanka’s SMEs and MSMEs for the development of its rural economy, the ADB sees SDB bank as a key strategic partner in the region.
“Sri Lanka is at the edge of a precipice with an unforeseen economic crisis with a scarcity of power and energy and food security that is detrimental to the entire nation, including SMEs that are not financially and operationally stable,” says Champa J Dasanayake, Head of SME of SDB bank. “The SME LoC from ADB is a lifeline for local SMEs, especially those driven by women, those that are not financially included and those located outside Colombo city areas and are thus exposed to economic vulnerabilities,” she adds.
All types of SMEs are permitted to apply for the loan facility, with priority given to Agriculture Agro-processing, Manufacturing, Fisheries, Tourism, Animal husbandry and Export Oriented businesses, excluding Trading, Leasing and Renting businesses Out of these, a special loan allocation is made for first-time borrowers, women-led enterprises, business owners with non-collateralised working capital loans and SMEs located outside the Colombo District.
The project also includes technical assistance (TA) to develop innovative financial schemes for SMEs and promote export-oriented cluster development – an initiative funded by the Japan Fund for Poverty Reduction (JFPR), which will help to augment SDB bank’s existing technical assistance initiatives for SMEs and MSMEs. In addition, the technical assistance will support the development of an ecosystem for women entrepreneurship in Sri Lanka, funded by the Women Entrepreneurs Finance Initiative (We-Fi). The We-Fi grant can be applied for by qualified enterprises, including SMEs requesting a minimum of Rs. 750,000 /-and a maximum of Rs. 30,000,000/, and where women play a significant role in the enterprise either in ownership, control, management or board operations. These sub loans are provided for working capital, land purchasing and construction, while trading, hiring, renting and leasing businesses are exempted.
The project also includes a Tea Small Holders Refinance Loan scheme to encourage new planting and replanting activities, considered to be a timely need to enhance the sustainability of the tea industry. The loan scheme is provided to support capital investments in all types of projects that will increase leaf production through good agriculture practices such as planting, infilling, nursery development, irrigation, water and soil management etc. Passionate about empowering women entrepreneurs, facilitating digital inclusion of the country’s masses and driving sustainability both financially and environmentally, SDB bank will actively roll out this SME project in partnership with the ADB in the coming months to uplift the nation by enabling deserving SMEs – the real drivers of Sri Lanka’s economy.
A future-ready bank, providing holistic, 360-degree support to its customers, SDB bank is a licensed specialized bank, constantly catering to ever-changing needs, through a combination of financial support and value additions to life and business through mentorship and knowledge-sharing focusing on areas such value chain enhancements and financial management. SDB bank is also committed to a sustainable business model in terms of environmental, social and governance sustainability. This commitment is reflected in the Bank’s financing activities, giving preference to businesses and initiatives that take a sustainable approach over those that do not. SDB bank has established itself as a financier that values every customer equally, for their potential and supports the development of individuals and SMEs with a special focus on women empowerment and digital inclusion.