As Sri Lanka works to enlist its one million strong SMEs in its middle income climb, it is also quietly bolstering the sector by directly intervening in one of the thorniest of issues-SME financing.

“Our government is working to make Lankan SMEs a strategic partner in its journey towards higher middle income ranks,” said Minister of Industry and Commerce Rishad Bathiudeen. He was addressing the 21st Sri Lankan Entrepreneur of the Year Awards hosted by the Federation of Chambers of Commerce and Industry of Sri Lanka. Almost 120 SME entrepreneurs across the country were feted at December 7 glittering evening, for their achievements in innovation and business with bronze, silver and gold awards. Joining the event were President of FCCISL Sarath Kahapalarachchi and FCCISL Secretary General Ajith D Perera.

It is estimated that slightly more than one million micro, small, medium and large enterprises are operating in Sri Lanka employing three million people.

“I am pleased to say that our government is working to make Lankan SMEs a strategic partner in its journey towards higher middle income ranks. My Ministry already started work towards this goal. The National Enterprise Development Authority (NEDA) and SMILE-3 programme under my Ministry have already started moving in this regard” said Bathiudeen, and added: “Among the large scale projects of NEDA are formulation of National SME Policy and creating an SME Authority. A National SME Action plan is also now being formulated. NEDA is also working on the publication of SME Guidebook and collecting info on Business Development Services (BDS) providers. My Ministry is also managing the Revolving Fund called as “SMILE 3 Revolving Fund” to help Small, Medium and Micro scale Enterprises (SMEs) financially. The project is handled through no less than participating commercial banks called as Participating Credit Institutions (PCI).  I am pleased to say that a total of four billion rupees (US $ 25 Mn) were distributed to SMEs from January to September this year. 976 projects have benefitted by this. Therefore I can assure our SMEs and industries that our unity government will continue to extend its strongest support to our SMEs and their good work.”

This year, Rs 4 Bn funds were disbursed to 976 projects (from Jan-Sept) for several SME aspects but mostly capital investments and working capital by Ministry of Industry and Commerce’ SMILE III. The number of SME projects benefited by SMILE III since 2012 is a whopping 2199 and since 2012 to to-date, Rs 5.7 Billion has been disbursed. The disbursements that were Rs 1.7 Bn in 2012-2015, saw a massive surge this year (Jan-Sept 2016 total Rs 4 Bn) after the SMILE loan cap was increased to Rs 25 Million (from previous Rs 5 million) by the Ministry to enhance its SME support.