Empowering Sri Lankan Entrepreneurs the RDB way
The Regional Development Bank (RDB), a 100% stateowned development bank,has invariably been determined to embolden the spirits of the innovative Sri Lankan entrepreneurs, spanning from the micro category upwards. On their journey towards supporting their customer base, the bank has introduced several loan schemes designed to provide financial support to the customers Island wide. One such loan scheme is the ‘Swashakthi scheme proposed by the current government’ to assist people with innovative business proposals. Chairman of RDB- Mr Prasanna Premaratne stated that the bank with a “keen interest to develop the rural masses” has taken the lead role to uplift the new enterprises. Introduced to support the government’s vision of creating one million new jobs within the country, Swashakthi loan scheme offers support to new entrepreneurs to take off their entrepreneurial endeavours. With funding coming through the National Budget, the loan scheme offers a maximum loan of Rs 200 000 with an additional grant of Rs 50 000.
The loan is available to new entrepreneurs in the category of micro and small scale industries who is seeking to create a new business with a minimum of one employee. With a payback period of three to five years and an interest rate of 5.5% per annum, Swashakthi scheme is available to the service and the manufacturing sectors Island wide.
In addition to the Swashakthi loan scheme, RDB’s Chief Executive Officer- Mr T. A. Ariyapala recently signed an agreement with the Asian Development Bank(ADB), through which, yet another loan scheme will be offered by RDB to the Sri Lankan entrepreneurs. The scheme will be available to small and medium scales entrepreneurs, offering financial assistance from Rs 500 000to Rs 50 Mn. This loan scheme can be used to purchase machinery and equipment required for the project and to meet working capital, The funds can not be used for civil construction. However interior décor and fittings can be funded with the loan proceeds.
Mr Ariyapala. went on to say that the bank is mainly targeting the youth and women entrepreneurs located outside the Colombo District. With a fixed interest rate of 12.1% per annum, , and a repayment period of 10 years including a maximum grace period of two years where the customer only has to pay the interest, will definitely support genuine manufactures and service providers throughout the Island.
The Regional Development Bank together with the Dept of Agriculture will also introduce a new concept of setting up outlets where entrepreneurs can sell ‘kola kanda’. With 4000 such units to be established islandwide, the projected net profit per month for the person selling “Kola kenda” will be around Rs 60,000. Mr Ariyapala stated that organic vegetables and fruits will also be promoted at these units.
As the premier state owned Development Bank, the RDB also has some special loan schemes to the genuine project promoters of Sri Lanka. Saubhagya Loan scheme for Industries and services up to Rs 25.0 Mn, SEPI scheme for the NVQ certificate holders could be obtained under the Central Bank refinance scheme. The Coconut Cultivation Board together with RDB has introduced “Kapruka” loan scheme to coconut growers while the coconut Development Authority (CDA) together with the RDB has come forward to assist the coconut based industries under the “Kapruka Jaya Isura scheme.
While involved in developing the economic activities, as a responsible corporate citizen, the Regional Development Bank has undertaken a CSR project to provide rural schools with sanitary facilities. Mr Premaratne elaborated on the project and said that initially, one school from each district will receive this facility during the current year.
While adverse weather conditions and certain internal factors, have affected the country’s economy and various industries to an extent, Mr Premaratne said, “That is only happening in certain areas of the country and is only a temporary set back”. However the overall growth in the Agriculture, Fisheries and Industry sectors show significant and positive results. Agreeing with the Chairman, Mr Ariyapala, the GM,CEO, said that the demand for developments loans from RDB is ever increasing. “We approve and disburse at-least 250000 individual loans per year,” he said, illustrating that while factors such as drought and floods can affect industries such as agriculture, entrepreneurs are not daunted by these issues. The deposit base of the RDB as well as the banking sector too has increased with good numbers. This shows some positives for the future of Sri Lanka. Securing GSP + is a huge bonus for the country and development Banks such as the Regional Development Bank expects more and more demand for it’s development loans concluded Chairman Mr Premaratna.
Currently the bank operates 268 branches spread throughout the island. Mr Premaratne stated that with the approval of the Central Bank of SL, the RDB hopes to further spread their reach to additional areas in the near future.