The Agricultural Bank of Egypt (ABE) allocated EGP 31bn in loans to micro-, small-, and medium-sized enterprises (MSMEs) during 2020, according to ABE Chairperson Alaa Farouk.
Farouk also said that 70% of the bank’s loan portfolio is directed to support and finance SMEs operating in the agricultural sector and related industries.
He added that the ABE aims to become one of the largest banks operating in the Egyptian market that finances MSMEs, and has placed this target at the head of its priorities and strategic plans.
He added that the bank is currently working on establishing and equipping 24 specialised credit units in governorate capitals to enhance the activity directed to the SME sector. These units will provide all financing and advisory services and economic feasibility studies for these enterprises, in order to support and enhance their capabilities.
Farouk emphasised that the Central Bank of Egypt (CBE) decision obliging banks to increase financing directed to SMEs is an important decision that will give a strong impetus to support the Egyptian economy.
It will mean more facilities are allocated, to ensure that financing reaches the market and creates millions of job opportunities for young people and achieve sustainable economic stability. It will also provide the opportunity for the informal economy to integrate into the formal sector, as part of the state’s initiatives to achieve financial inclusion.
Farouk said that this decision also represents an actual translation of President Abdel Fattah Al-Sisi’s directives to encourage financing of companies and MSMEs given. This is particularly given their strategic importance in achieving the economic growth of the state.
He stressed that the CBE will remain supportive of the national economy, with its successive initiatives aimed at developing the banking sector and enabling it to perform its role in the manner assigned to it.
It will also lead the banking system to contribute strongly to the revitalisation of the Egyptian economy, by launching a large number of initiatives in the areas of financing the industrial sector and supporting and financing projects.
He added that the CBE’s initiatives aimed at companies and MSMEs are the cornerstone for the development of this important sector of the national economy.
This is thanks to the policy of pricing these initiatives with a small diminishing return, indicating that the ABE is a fundamental partner in all these initiatives, based on its role in supporting this sector.