Colombo Chamber submits proposal to effectively implement SME moratorium

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L to R: Afthab Selabdeen (Director/Assistant secretary), Dilesha Perera (Secretary), Damith Gangodawilage (Treasurer), Saranga Wijeyarathne (President), Roshan Gunawardane (Senior Vice President), Lakmal Vajirasiri (Assistant Secretary)

Jan 29, 2020 (LBO) – Colombo Chamber of Commerce has decided to submit several proposals for the effective implementation of the moratorium for SMEs and achieve its desired objectives.

Full statement

PROPOSALS OF COLOMBO CHAMBER OF COMMERCE ON BEHALF OF SMEs OF SRI LANKA FOR THE EFFECTIVE IMPLEMENTATION OF CIRCULAR NO.01 OF 2020 DATED 13 JAN 2020

The Colombo Chamber of Commerce wishes to express its gratitude to His Excellency Gotabhaya Rajapakse, the Dynamic President of Sri Lanka for this vision and mission to create a new Sri Lanka to benefit the common man has taken a very bold, very positive and focused effort to resurrect the economy by helping the local SMEs and granting them moratorium for loans from Scheduled Banks. We as Colombo Chamber of Commerce believe this credit support scheme has a positive impact on accelerating Economic Growth.

For the effective implement of the moratorium and achieve its desired objectives, Colombo Chamber of Commerce wishes submit following proposals.

  1. The moratorium was announced on 13th January 2020 and all borrowers were requested to make a written request on or before 31.01.2020. We feel the deadline given to the borrowers is too and propose to extend the same at least till 29.02.2020 where SME sector has adequate time to study and make a request for the moratorium.
  2. There was a mention that directive applies to all financial institutions and includes the Finance Companies but the formal circular covers only licensed banking sector. The lower tier of the SMEs has obtained loans from Finance Companies as the scheduled banks insist on heavy collaterals. We wish to appeal to extend this moratorium to the Finance Companies and Merchant Banks. We propose that the upper limit cap should be restricted to Rs.3,000,000/= (Three Million Rupees) to ensure that the Finance Companies/Merchant Banks are not over exposed in supporting the lower tier of SMEs.
  3. Colombo Chamber observes that the awareness level of the circular, content, facilities benefits offered, process to apply etc. among stake holders is extremely low. We propose an extensive awareness campaign to be launched immediately to communicate real benefits of the scheme.
  4. It was reported that the significant number of borrowers are visiting banks, Treasury , Finance Ministry and other relevant organizations to obtain information with regard to the scheme. We propose specially for the benefit of people who are living outstation to immediately launch a “Help-Line” with operators who has a sound knowledge of the scheme to educate and guide borrowers towards getting maximum use of this scheme.
  5. The Circular proposed a Credit Guarantee Scheme to provide risk mitigation arising of any additional loans and advances for up to 75% of the capital sum granted. Therefore we propose to urge all banks not to be strict on additional collateral from borrowers(at least up to a specified amount) which make bail-out package more realistic for most of the borrowers.
  6. In addition to above proposals to the Government, Colombo Chamber of Commerce is in the process of forming a “Professional Advisory Committee “to advice/ assist SME sector on business revamping and guiding. Our experts with over 30 years of Export industry experience are able to effectively guide all young and upcoming entrepreneurs. Colombo Chamber of Commerce will reserve (1) day per week for one to one meetings to assist all Exporters.
  7. We appeal to His Excellency to include at least one Board Member of Colombo Chamber of Commerce to the NES (National Export Strategy) steering committee for Colombo Chamber of Commerce which is dedicated to Drive Exports as per the vision of His Excellency.
  8. Colombo Chamber of Commerce is endeavoring to take the Chamber to other towns Galle being the first Colombo based Chamber to move to other towns to bring development and guidance to the lower tier to guide them to be self made entrepreneurs.
  9. Our Board Member comprise of upcoming leaders 70 per cent are below the age of 45.

We laud the dynamic leadership, vision, foresight, faith and the confidence of His Excellency Gotabhaya Rajapakse for nation building and empowering the SMEs who are most deserving and the ones who need this relief the most.

COLOMBO CHAMBER OF COMMERCE