Govt to expand collateral-free loans to 3,000 entrepreneurs by year-end

By the end of this year, another 1,000 entrepreneurs will be able to access collateral‑free loans under the National Credit Guarantee Institution (NCGI), bringing the total beneficiaries to 3,000, Deputy Minister of Industry and Entrepreneurship Development Chathuranga Abeysinghe said. The milestone follows the issuance of the 2,000th guarantee through Commercial Bank to a kithul products entrepreneur, marking a symbolic step in widening financial access. The expansion was celebrated with the opening of NCGI’s new operations center at HNB Tower in Colombo. Deputy Minister Abeysinghe said the program was designed to revive stalled dreams of capable entrepreneurs who lacked collateral. “Normally, when you go to a bank for a loan, the first question is ‘what collateral do you have?’ Because of a lack of collateral, many capable entrepreneurs’ dreams were stalled. It is to give life to those dreams that we introduced this credit guarantee system. Now, instead of collateral, the government intervenes to provide you with a guarantee,” he explained. To qualify for the facility, businesses must demonstrate organized operations, strong financial cash flow, practical forecasts, and secure agreement from their bank. Since its launch 15 months ago, NCGI has enabled more than Rs. 14 billion in credit facilities through 2,000 guarantees. The institution aims to further strengthen the financial sector by promoting microfinance, cooperative banking, a development bank, and an ownership capital fund. (Newswire)