The total portfolio of small and medium-sized enterprises (SMEs) in the National Bank of Egypt (NBE) amounted to EGP 65bn by the end of June 2019, compared to EGP 49bn in June 2018, an increase of EGP 16bn, a growth rate of 32%, according to the bank’s Chairperson, Hisham Okasha.
Okasha explained that the portfolio of loans to these projects within the initiative of the Central Bank of Egypt (CBE) amounted to about EGP 37.5bn by the end of June 2019. The EGP 37.5bn was granted to 42,000 clients, up from EGP 25.2bn for 26,000 customers in June 2018, marking a 49% increase.
Okasha opened the bank’s first business development centre in El Yasmeen branch in the 10th of Ramadan City.
Furthermore, Okasha said that the business development centres launched by the bank are in line with the directives and supervision of the CBE. These centres’ primary objective is to consolidate the concept of entrepreneurship, by providing entrepreneurs with the financial and non-financial services needed for their projects, which exceed typical banking services.
He stressed that financing is no longer an obstacle to the owners of SMEs, which increases the need for the establishment of these centres. In turn, they will provide many services that will enable the financial education of customers in order to achieve the highest rates of quality and success for their projects.
For her part, the Deputy Governor of the CBE, Lobna Helal, pointed out that the opening of the NBE’s business development services in the 10th of Ramadan City supports the initiative of Nile Pioneers, which is integrated with the CBE’s initiatives and directions.
She added that these initiatives seek community development and support Egypt’s 2030 Sustainable Development Plan, which aims to promote innovation, stimulate the youth’s potential, foster entrepreneurship, embrace emerging companies, and provide technical, managerial, and financial support in areas suited to the Egyptian market needs.
Helal stressed the vital and effective role of the banking sector in supporting SMEs, entrepreneurship, and transition into the formal sector. This has a direct impact on supporting the country’s important economic sectors, such as industry, agriculture, information technology, and innovation. Inevitably, this helps in creating jobs and boosting the national economy.
Additionally, she pointed out that the CBE aims to open 30 business development service centres in a number of Egyptian governorates in the Delta and Upper Egypt through the 11 banks participating in the Nile Pioneers Initiative by the end of 2019.
According to Helal, the CBE is keen to achieve coordination and cooperation between the various bodies and entities that have relevance to the field of entrepreneurship and SMEs, to maximise the benefit for all parties of the economic system.
Deputy Chairperson of the NBE, Yehia Abou El-Fotouh, said that the bank is preparing a plan to expand the establishment of business development service centres in a number of places that focus on SMEs.
He pointed out that the bank started preparing a comprehensive study of the market and its needs, which led to the opening of the 10th of Ramadan centre. It is in the middle of one of the vital industrial areas, which includes a complex of factories and a variety of activities. In turn, it will serve a number of areas and neighbouring cities such as Shorouk, Badr, and Belbes, where 12 NBE branches are located.
Abou El-Fotouh revealed that preparations are being set up for the opening of two additional centres in Assiut and Tanta to serve clients in Upper and Lower Egypt.
According to Mamdouh Afia, head of the NBE’s SMEs sector, the business development service centres will provide a variety of services through well-trained teams, including some non-financial services, as well as access to finance services.
He explained that among the services that will be provided by these centres is the introduction of a new project idea; orientation toward licensing procedures; availability of feasibility study services; financial analysis and evaluation; effective communication with suppliers and target markets; knowledge dissemination services; training and capacity building, and workshops that fit the diversity and the needs of the Egyptian market.