ICEC

Egypt central bank allocates 2 bln pounds to cover SME financing risks

Egypt’s central bank has approved to grant Credit Guarantee Company (CGC) 2 billion Egyptian pounds ($112 million) aimed to guarantee the credit risks of financing small and medium-sized businesses.

The agreement will see CGC issue guarantees to the banks that offer funding for SME projects to cover part of the associated credit risks.

The money comes under the Central Bank of Egypt’s initiative that aimed to direct banks to increase finances provided to micro, small, and medium enterprises, to be not less than 20 percent of their loan portfolios, the central bank said in a statement on Wednesday.

The central bank is studying applying a cooperation mechanism with Credit Guarantee Company in order to benefit from its expertise in covering credit risks associated with financing SMES, it added.

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