CBE encourages banks to invest in equity for SMEs through some incentives

The Central Bank of Egypt (CBE) agreed to allow banks to count their own equity investments in SME-focused funds as part of the mandatory minimum portion of their loan portfolios they are required to allocate to SMEs which amounted to 20 percent.

The measure is meant to give commercial banks incentives to back angel investors, venture capitalists, and private equity growth funding for SMEs.

In 2016, CBE obliged Egyptian banks to give out 20% of their total loans portfolio to small and medium enterprises (SMEs). This will provide 350,000 SMEs with EGP 200 billion in four years at 5% interest rate.