The National Bank of Egypt (NBE) financed 47,000 small- and medium-sized enterprises (SMEs), as well as some micro businesses, with EGP 28bn as of the end of June 2016.
This amount excludes the value of funds provided for projects that had grown to become similar to major companies, according to NBE chairperson Hisham Okasha.
The bank injected funds amounting to EGP 12.3bn into 18,000 projects in fiscal year (FY) 2015/2016, with a growth rate of 71% in the value of provided facilities. This amounts to a 32% growth in financed projects, compared to FY 2014/2015, Okasha added.
He emphasised that SMEs are a key pillar of the bank’s strategy, aiming to provide more sustained support to this vital activity and enlarge the size of the bank’s portfolio directed at this sector to EGP 72bn over four years.
These statistics are a result of the bank’s interest in developing SMEs, Okasha said. “SMEs are direct job creators. They solve the unemployment problem, improve the standard of living, and achieve targeted development,” said the chairperson.
Following the launch of the Central Bank of Egypt’s (CBE) initiative to support SMEs, Okasha said that the bank continues to achieve good results in a number of projects that are financed as part of the initiative.
He explained that the bank provided funds amounting to EGP 950m for 1,100 projects during June, with a growth rate of 30% in the financed projects, and 40% in the value of the facilities provided to the projects, compared to May.
Since the beginning of the initiative five months ago, the total projects financed reached 4,700─89% of which were micro businesses. The total value of facilities provided during that period reached EGP 3.3bn, including 66% facilities for micro businesses.
“77% of the projects that benefited from the initiative have obtained loans, with the aim of expanding their activities. This is equivalent to 86% of the total loans provided, and 23% of those provided for newly-established projects,” Okasha said.
He added that the bank has managed to attract 3,336 new clients, which is equivalent to 71% of projects financed within the framework of the initiative by the CBE. This means that the bank has managed to achieve financial inclusion and attract new segments that had never dealt with banks in the past.
“New clients benefited from about EGP 2.06bn, which is equivalent to 62% of total finances provided within the framework of the initiative launched by the CBE, whereas total finances provided to the two segments with the aim of expanding existing projects reached EGP 2.855bn. On the other hand, financing newly established projects costed EGP 480m,” Okasha said.
He explained that most clients were from Upper Egypt, who also enjoyed the largest share of the bank’s financing. They represented 37% of total clients, and 26% of the financing value, followed by governorates in Lower Egypt with 27% of clients and 30% of value. The canal governorates represented 15% in terms of the number of clients and 13% in terms of financing value.
According to Okasha, the sectors of the initiative’s financed SMEs vary, including industrial, agricultural, commercial, and service activities.
He added that the bank has set up a modern strategy to simplify the procedures of financing these projects, relying on a professional team of about 1,000 marketers. The bank plans to increase the number to 1,500 marketers during 2016.