Maldives Monetary Authority (MMA) has said it has received applications for loan guarantees worth over MVR44 million under its credit guarantee scheme (CGS) for small and medium-sized enterprises.
The central bank recently increased the total amount allocated for the scheme from MVR50 million to MVR100 million.
It has so far provided guarantees to 6 parties and is now processing guarantees for loans worth over MVR39 million, according to MMA.
MMA launched the scheme in August last year, with the aim of facilitating access to finance for SMEs. The central bank says the scheme will guarantee a portion of the credit, which mitigates the credit risk to the banks and hence facilitates lending against zero collateral requirements. The scheme will provide for Maldivian owned SMEs to apply for commercially viable loans between hundred thousand to one million Rufiyaa, with no collateral. MMA has negotiated with the participating banks for these loans to be at favourable interest rates, with up to 5 years for repayment.
Six commercial banks operating in the country are participating in the scheme.