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“Our business is at more risk than profitable banks and financial institutions,” they say
by Sanat Nanayakkale
The National Trade Protection Council (NTPC), which represents over 30,000 small and medium-sized enterprises (SMEs) in the country and provides direct employment to over 4.5 million Sri Lankans, said the normalization of the economy has helped its members to improve. said to be the most important. After meeting with Ceylon Central Bank Governor Dr Nandalal Weerasinghe on December 29 to discuss the matter, Ranil he asked President and Finance Minister Wickremesinghe to extend the moratorium on the loan. December 31, 2022 to prevent their business
NTPC Governor G. Mahendra Perera told media that he had drawn up an eight-point formula for central bank governors to address the issue in a way that would protect the operations of these small and medium-sized enterprises. Many small businesses will be forced to close unless authorities take immediate action, he said.
He said the council had pointed out to the governor that loans made by SMEs reached Rs 1 trillion. They owe these money to banks and non-bank financial institutions.
“The governor has repeatedly said that the Sri Lankan economy will contract further and that recovery will take a long time, so if nothing is done, at least 20,000 SMEs will be out of business by early 2023. We told him that we would have to stop, which the relevant authorities have taken to delay the repayment of interest and capital on loans made by our company.”
“In order to enable the majority of our members to continue their business operations, we have proposed that the government take immediate steps to implement eight measures. 2023, postpones legal actions already taken against the borrower until the end of 2023, extends the capital repayment of the loan until the end of 2023, and concessional to continue We will provide loan interest rates applicable to the interest rate by the end of 2023 and by the end of November 2023 to review positions (proposed no more than 15% per annum) and partially or fully waive interest upon settlement of all facilities. , extend all concessions granted under Circular No. 2 of 2022 dated July 7, 2022 to the end of 2023.
They also made a proposal that in the event of facility rescheduling, area interest should not be added to capital and soft loans should be downgraded at nominal rates. In the area, about borrowing.
“I urge the Monetary Authority and the Government to immediately pay attention to the above proposals which will give a much-needed lifeline to SMEs, which represent over 52% of Sri Lanka’s GDP and over 45% of its workforce. The Board said details of bank borrowings by small business entrepreneurs were provided to governors that deserve careful perusal given the vulnerability of such small businesses.
When asked if they had received a favorable response from the governor on their proposal, they said, “We are not satisfied with the response we have received from the governor on this point. I felt that I was not looking at this from the perspective of SMEs, so I am also asking the Minister of Finance to mediate.”
“Banks have been profitable so far, so we believe they have the ability and resilience to survive even after extending this moratorium for another year. It’s not an NBFI, given a reasonable amount of time and the facilities required, we can pay off our debts and contribute positively to the economy as usual.That’s the way forward. Both the country and the banks will suffer if there are no small businesses to do so.”
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