Deputy Minister of Industry and Entrepreneurship Development Chathuranga Abeysinghe has provided a detailed explanation of Sri Lanka’s collateral‑free loan system, outlining how small and medium‑scale businesses can access financing without pledging land or fixed assets.
The Deputy Minister noted that under this scheme, loans are granted based on business viability, with the government providing 70% security and banks or financial institutions covering the remaining 30%. For women entrepreneurs, the government’s contribution rises to 80%.
According to Abeysinghe, 1,747 businesses have already benefited from the program.
He stressed that no ministerial letters or political approvals are required, as applications can be made directly through banks under the National Credit Guarantee Institution (NCGI).
Loan eligibility is determined by the strength of a business’s cash flow, with banks making recommendations and NCGI granting approval.
The scheme offers financing ranging from Rs. 500,000 to Rs. 25 million, creating new opportunities for capable and resilient SMEs, he said.
Abeysinghe added that if banks fail to inform applicants or reject requests unfairly, entrepreneurs can seek direct support from NCGI.
The Deputy Minister has issued the clarification after questions were raised by many people following his recent parliamentary speech related to matters concerning collateral‑free loans. (Newswire)