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The National Development Bank (NDB), in association with the Sabaragamuwa Province, Chamber of Commerce and Industries discussed ways to assist entrepreneurs in the Sabaragamuwa province. The aim of the meeting was to update entrepreneurs on the developments regarding the NDB group, and the availability soon of a complete financial service, consisting of development banking and commercial banking products.

The meeting was attended by over 50 participants. At the outset, Patrick Fernando, Managing Director of the Chamber, welcomed the participants and thanked NDB for hosting the event which he said "is of great help to the entrepreneurs in the Sabaragamuwa Province."

A. L. Somaratne, Assistant General Manager, SME and SME Development - NDB, explained the Bank's history in its association with the development of the Small and Medium Enterprises (SME) sector through the well-known Small and Medium Industries (SMI) Loan Scheme.

He said "NDB Ratnapura branch has assisted over 400 enterprises in the Province and added that with the National Development Bank and NDB Bank expecting to merge during the early part of 2004, entrepreneurs will also have the opportunity to make use of the merged entity in depositing their excess cash in the form of saving or fixed deposits."

He said, "the success of the Ratnapura Branch is mainly attributed to the enormous support it received from the business community in the area."

He requested that they "continue to work with the NDB group where soon a complete financial package could be obtained under one roof. The NDB group has an insurance arm as well, namely Eagle Insurance Co., where all they're insurance requirements would be met."

R. D. Abeywardena, Senior Manager, SME Development - NDB said, "a major credit line which the Sabaragamuwa business community could make use of is the ongoing Sahanya credit line. Existing SME's or those who wish to set up a SME could obtain a maximum loan of Rs. 35.0 million from the NDB Ratnapura Branch under this scheme. On implementation of such a project, the value of fixed assets of a single enterprise should not exceed Rs. 70.0 million excluding investment in land and buildings.

Terms with regard to repayment and interest are very attractive under Sahanya." He said the NDB has yet another scheme which is known as KfW Micro Loan Scheme. Under this scheme, any small enterprise including those engaged in trading could obtain loans to the extent of Rs. 500,000. However, fixed asset value of such enterprises should not exceed Rs. 3.0 million.

The rate of interest applicable for loans under this scheme is 10.5% per annum, which too is on the reducing loan balance. For repayment of such loans, a maximum of five years would be considered based on the cash flow of the project including a maximum grace period of one year. The client's contribution expected for such projects to be funded under KfW Micro Loan Scheme is only 25% of the total project cost.

He said that existing as well as potential entrepreneurs who seek assistance under all these schemes should have a technically feasible and commercially viable project and a good track record with the banking community with regard to their past borrowings, if any. They were also advised to obtain assistance when needed from the Chamber in formulating their projects to obtain assistance from the NDB."

Chamli Gunaseela, President, Sabaragamuwa Province Chamber of Commerce and Industries, Lalith Liyanage, Founder President of the Chamber, Ravindra Ranjith, Senior Manager, Branch Operations, NDB, and Keerthi Liyanage, Manager, NDB Ratnapura Branch were also present.

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