A pleasant decision from the Central Bank for small business owners

The Central Bank of Egypt extended, for an additional year, the period of obligating the country's banks to increase the percentage of loans to small and medium enterprises to 25% of their total credit portfolio.

The Central Bank of Egypt announced the extension of work with the target percentages for companies and micro, small and medium enterprises until December 2023.

An additional year to increase small business loans

  This decision requires banks to achieve 25% of banks’ credit facilities portfolio to finance companies and micro, small and medium enterprises, with 10% directed to financing small companies, for an additional year period ending on December 31, 2023 instead of December 31, 2022.

Increasing the loan and facilities portfolio

The Central Bank said, in a periodic book for banks today, that its decision comes in light of its continuous follow-up of the performance of banks, with the aim of providing more support for micro, small and medium companies, and motivating banks to continue financing them to enhance economic growth.

It is noteworthy that in February 2021, the Central Bank directed banks, obligatorily, to increase the portfolio of loans and credit facilities for companies and micro, small, and medium enterprises from 20% to 25% of the total bank’s credit facilities portfolio, provided that banks are committed to achieving this percentage before the end of the year. Present.

  Small and medium enterprises

Mohamed El-Etribi, Chairman of the Board of Directors of the Federation of Egyptian Banks, revealed last March that the total portfolios of credit banks in the field of small and medium enterprises amounted to about 400 billion pounds by the end of 2021, an increase of 287 billion pounds over 2015, the year the initiative was launched.

The Egyptian government's decisions, in November, did not include the transfer of some low-interest financing initiatives to the Ministry of Finance. The initiative to finance small and medium enterprises at 5% interest is still under the supervision of the Central Bank.