Government considering expanded aid for SMEs amid financial woes

• Decides to compile reports on loans received by SMEs in order to design targeted aid measures, address credit obligations and increase the resilience of SMEs

The high-level meeting, chaired by GNRD Aponsu, Senior Additional Secretary to the President for Finance and Economic Affairs, highlighted the Government’s commitment to supporting Small and Medium Enterprises (SMEs) facing financial difficulties.

The meeting, held at the Presidential Secretariat, brought together officials from the Ministry of Finance, the Central Bank and the Sri Lanka Association of Banks (Garanti) Ltd., reflecting the urgency of finding solutions to the economic challenges faced by SMEs.

At the forefront of the discussions was the temporary suspension of the debt collection process under the Parate law, which provides significant relief to SMEs. However, this suspension is planned to end on December 15, raising concerns about the future of struggling businesses.

Authorities explored measures to expand support for these businesses and ensure sustainability.

The remarkable result of the meeting was the decision to prepare a comprehensive report on SME loans. This initiative, spearheaded by the Central Bank and commercial banks, aims to provide a detailed understanding of the financial commitments undertaken by SMEs. The report will serve as a basis for designing targeted aid measures to meet credit obligations and increase the resilience of SMEs.

Officials emphasized the need to align financial assistance with strategies to increase economic productivity by examining ways in which the banking sector can provide additional avenues of support to SMEs.

The Central Bank and the Sri Lanka Banking Association are reviewing the feasibility of further extending the suspension of debt collection. A key focus will be on balancing aid measures with the need for long-term fiscal sustainability.

Many key officials attended the discussion, including Central Bank of Sri Lanka Director of Banking Supervision RRS De Silva Jayathilake and Senior Deputy Director AMAD Amarakoon. Also present were Sri Lanka Association of Banks (Garanti) Secretary General Indrajith Boyagoda, Union Bank Chief Executive Officer Dilshan Rodrigo, Sampath Bank Senior Deputy General Manager Manoj Akmeemana, Bank of Ceylon Deputy General Manager Sampath Perera, Commercial Bank Deputy General Manager. Nalin Samaranayake, Hatton National Bank Recovery and Rehabilitation Manager Nirosh Perera and Standard Chartered Bank Chief Executive Officer Bingumal Thewarathanthri.