The Industrial Development & Workers Bank of Egypt (IDBE) has recently launched 11 products and programmes in order to meet the financial needs of small and medium enterprises (SMEs), as well as very small businesses, according to El-Sayed Mohamed El-Kosayer, the bank’s chairperson.
El-Kosayer told Daily News Egypt that loans allocated for SMEs represented about 16% of the bank’s total loan portfolio by the end of February 2016, and there is a plan to increase it to 20% by the end of 2016 to meet the Central Bank of Egypt’s (CBE) requirements before the deadline. CBE stipulated that 20% of the bank’s total loan portfolio must be allocated to SMEs, in addition to very small businesses, within four years.
El-Kosayer said the volume of SMEs’ loans reached EGP 800m of the bank’s total loan portfolio, which stood at an estimated EGP 4.9bn in February 2016.
The bank has completed preparations for these projects’ financing strategy, which were presented to CBE in February 2016, El-Kosayer said.
In January 2016, the bank launched a programme to finance SMEs and very small businesses with a small interest rate of 5%, and a repayment period of five years, with facilitated conditions and procedures.
According to El-Kosayer, the bank’s plan that was presented to CBE includes focusing on financing craft and productive labour-intensive projects, with an added value to the national economy. The plan also focuses on projects in Upper Egypt and the Delta’s countryside.
He added that the bank has all the capabilities and expertise needed to efficiently finance these projects. It is also training teams specialised in dealing with the owners of these projects.
El-Kosayer said his bank is considered the second largest bank to lend to small businesses in the Egyptian market, after the National Bank of Egypt (NBE), according to the Social Fund for Development.
“The bank’s plan to support SMEs and small businesses includes increasing IDBE’s geographic spreading in order to reach project owners everywhere,” he added.
The bank currently has 17 branches and more are expected to be opened in the area of Helwan, as well as Quesna Industrial Zone. The work is ongoing on the construction of the bank’s headquarters in New Cairo.
IDBE is considering establishing three mini branches to support the initiative launched earlier by CBE to work on spreading banks all over the country in order to achieve financial inclusion, El-Kosayer said.