US signs deal with private bank to help MSMEs in Sri Lanka

The United States (US) has signed an agreement with a private bank to assist micro, small and medium enterprises (MSMEs) in Sri Lanka.

U.S. Ambassador Julie Chung witnessed the signing of Memorandum of Understanding (MOU) between DFCC Bank and the U.S. government’s Agency for International Development (USAID) Private Sector Development project to expand financial services to MSMEs in Sri Lanka.

“The U.S. Government shares DFCC’s belief that lending to MSMEs will increase GDP and employment during these challenging times,” said U.S. Ambassador to Sri Lanka Julie Chung. “Through powerful partnerships such as this one with DFCC Bank, we can help MSMEs increase revenues, attract investments, and create jobs – especially for women and youth.”

Through this MOU, DFCC and USAID’s Private Sector Development project will enhance financial products and services for MSMEs, strengthen digital penetration and market linkages for MSMEs, and increase access to commercial lending to MSMEs, especially to enterprises located outside of Western Province and those led by women.

Commenting on this partnership, DFCC Bank CEO Thimal Perera said, “At DFCC Bank, we are proud that many of our clients started as MSMEs and have grown with us to be large corporations and conglomerates that add value to the economy. Through this new partnership with USAID and Palladium, we look forward to increasing our capacity to empower and facilitate the robust growth and development of the MSME sector – especially women-led enterprises – in Sri Lanka.”

Established in 1955, DFCC Bank is one of the oldest development banks in South Asia. The bank has historically played a crucial role in the development of the private sector and has financed many trail-blazing start-ups that are now leading companies in Sri Lanka. In July 2021, DFCC was awarded a USD150Mn credit line by U.S Development Finance Corporation (DFC) through which it launched DFCC Aloka to help women-led businesses benefit from several financial and non-financial services, including preferential interest rates and insurance options.

The USAID PSD project expands financing opportunities for MSMEs by facilitating financing that increases MSME competitiveness, productive employment, innovation, and market linkages. This is one component of the longstanding partnership between the U.S. and Sri Lanka to support self-reliance, strengthen stability, and promote economic growth.  (Colombo Gazette)