As an agent to the government, Regional Development Department (RDD) implements various concessionary Loan Schemes targeting Micro, Small and Medium Scale Enterprise (MSMEs) with the view of expanding access to finance through credit supplementation to generate employment opportunities and reduce income disparity of underserved segment of the country with the funding assistance of the Central Bank of Sri Lanka (CBSL), Government of Sri Lanka and Donor agencies.
In terms of the Section 88 of Monetary Loan Act (MLA), Refinance Loan Schemes are implemented with the aim of granting financial accommodation to any credit institution in respect of lending operations carried out by such institution for any productive purpose.
In terms of the Section 108 of MLA, Credit Guarantee and Interest Subsidy Loan Schemes are implemented with the objective of acting as an agent, or for the account, of the Government or of any of the agencies or institutions in guaranteeing, insuring, or participating in the loans, or any category.
Loans Schemes
New Comprehensive Rural Credit Scheme (NCRCS)
| Purpose | Uplift the socioeconomic conditions of micro and small scale farmers who engage in cultivation of paddy and short term crops including home gardening |
| Funded by | Government of Sri Lanka -Interest Subsidy and Credit Guarantee. Participatory Financial Institutions – Loan Financing |
| Area of Operation | All Island |
| Participatory Financial Institutions | Bank of Ceylon, People’s Bank, Commercial Bank of Ceylon PLC, Hatton National Bank PLC, Seylan Bank PLC, Sampath Bank PLC, DFCC Bank PLC, Union Bank of Colombo Ltd, Pradeshiya Sanwardhana Bank, National Development Bank PLC, Sanasa Development Bank Ltd, Housing Development Finance Corporation Bank of Sri Lanka, Cargills Bank Ltd |
| Maximum Loan Limit & Period | Differ by Crop to Crop.( Max. Rs 2,000,000 days) |
| Interest Rate | 8% |
| Credit Guarantee | 60% of the principal amount in loss for willful defaulters |
| Eligible Categories | Farmers who cultivate the eligible crops such as Paddy, maize, chilies, tomato, potato and Other short term crops |
Saubagya Loan Scheme (Prosperity)
| Purpose | Start up or expand any micro, small and medium scale enterprise (MSME) or any MSME affected by disasters |
| Funded by | Central Bank of Sri Lanka |
| Area of Operation | All Island |
| Participatory Financial Institutions | Bank of Ceylon, People’s Bank, Hatton National Bank PLC, Commercial Bank of Ceylon PLC, Sampath Bank PLC, Seylan Bank PLC, Pradeshiya Sanwardhana Bank, Sanasa Development Bank Ltd, National Development Bank PLC, Nations Trust Bank PLC, Pan Asia Banking Corporation PLC, Union Bank of Colombo PLC, DFCC Bank PLC, Housing Development Finance Corporation Bank of Sri Lanka, Indian Bank, Cargills Bank Ltd, Sri Lanka Savings Bank Ltd, State Mortgage & Investment Bank |
| Maximum Loan Limit & Period | Rs. 25 Mn, 5 years with 6 months grace period |
| Interest Rate | 9% |
| Excluding… | Purchase Land, Building, Vehicle, fuel and service station, Buying and Selling commodities |
Smallholder Agribusiness Partnership Programme (SAPP)
| Purpose | Increase the production, productivity, and quality and value addition of agriculture produce |
| Funded by | International Fund for Agricultural Development |
| Area of Operation | All Island |
| Participatory Financial Institutions | Bank of Ceylon, People’s Bank, Hatton National Bank PLC, Commercial Bank of Ceylon PLC, Sampath Bank PLC, Pradeshiya Sanwardhana Bank, DFCC Bank PLC, Cargills Bank, Sanasa Development Bank Ltd |
SAPP-Youth Loan Scheme
| Eligible Sub-borrowers | Youth entrepreneurs and/or group of youth entrepreneurs connected to any agriculture value chain and fall within the age category of 18 -40 years |
| Eligible Activities | Capital investment and/or working capital as per the business proposal agreed by the Participatory Financial Institutions and recommended by PMU |
| Maximum Loan Limit | Rs. 2 million |
| Maximum Grace Period | 12 months for monthly repayment depending on the requirements of the project |
| 12 months for monthly repayment depending on the requirements of the project | 60 months |
SAPP-Income Generation Loan Scheme
| Eligible Sub-borrowers | Individuals engaged in income generation activities in agriculture, fisheries & livestock sectors |
| Eligible Activities | Activities in agriculture, fisheries & livestock sectors |
| Maximum Loan Limit | Rs.300, 000 |
| Maximum Grace Period | 12 months for monthly repayment depending on the requirements of the project |
| Maximum Repayment Period (Including the Grace Period) | 36 months |
Poverty Alleviation Microfinance Project Revolving Fund (PAMP RF)
| Purpose | Poverty alleviation through promotion of income generating activities and organizing low income groups to link them with formal banking system |
| Funded by | Central Bank of Sri Lanka |
| Area of Operation | Colombo, Kalutara, Gampaha, Kandy, Matale, N'Eliya, Galle, Matara, Hambantota, Kegalle, Kurunegala |
| Maximum Loan Limit & Period | Rs.50,000 for 3 years (No grace period) |
| Interest Rate | 12% |
| Target Group | Households whose monthly income is less than Rs. 7,500 |
Self Employment Promotion Initiative Loan Scheme Phase II (SEPI II)
| Purpose | Provide financial assistance to youth trained by recognized vocational training institutions for establishment of their own self-employment projects |
| Funded by | Government of Sri Lanka |
| Area of Operation | All Island |
| Maximum Loan Limit & Period | Rs. 1, 000,000 for 5 years including 6 month grace period |
| Interest Rate | 7% |
| Target Group | Youth trained by recognized vocational training institutions |
Interest Subsidy Scheme under Smallholder Tea and Rubber Revitalization (STaRR) Project
| Purpose | provide concessionary financial facilities for the smallholder farmers who experience delays in income generation from replanted tea and new planted rubber plantations. |
| Funded by | Government of Sri Lanka -Interest Subsidy Participatory Financial Institutions – Loan Financing |
| Area of Operation | Galle, Matara, Ratnapura, Badulla, Kandy and Nuwara Eliya Districts for loans related to Tea Smallholders Monaragala and Ampara Districts for loans related to Rubber Smallholders |
| Maximum Loan Limit & Period | Rs. 250,000 for 3 years including 3 month grace period |
| Interest Rate | 9% |
| Target Group | Tea and rubber smallholder farmers, recommended by the PMU in consultation with MPI |
Domestic Agriculture Development Programme – Pilot Phase (DAD-PP)
| Purpose | To develop the domestic agriculture sector and to promote agriculture exports. rubber plantations. |
| Funded by | Central Bank of Sri Lanka |
| Area of Operation | All island |
| Maximum Loan Limit & Period | Rs. 25mn for 5 years including 1 year grace period |
| Interest Rate | <1Mn. - 4% >=1Mn. - 5% |
| Target Group | Dairy, Spices, Vegi sector lead players |
Swashakthi- Loan Scheme for The Micro, Small and Medium Scale Enterprise Sector Development And Employment Generation
| Purpose | Generate employment opportunities, for new young entrepreneurs engaged in income generating activities Micro, Small and Medium Scale Enterprise (MSME) Sectors. |
| Funded by | Central Bank of Sri Lanka |
| Area of Operation | All island |
| Maximum Loan Limit & Period | Rs.450,000 + Grant (Maximum grant amount: Loan > 200,000 - Rs.50,000 Loan < 200,000 - 25% of the loan amount) 5 years including 1 year grace period |
| Interest Rate | 5.5% |
| Target Group | New young entrepreneurs |
Refinance Scheme for COVID19 affected State Own Enterprises (SOE)
| Purpose | To fulfill the working capital requirements and setting the statutory obligations of State Own Enterprises (SOEs). rubber plantations. |
| Funded by | Central Bank of Sri Lanka |
| Area of Operation | All island |
| Maximum Loan Limit & Period | Working capital requirement for a maximum of 3 months period and the statutory obligation after considering the business plan of the relevant SOEs or the maximum eligible amount recommended by Dept of Public Enterprises (DPE) of Ministry of Finance, whichever is lower. 3 years including 6 month grace period |
| Interest Rate | 4.0% |
| Target Group | SOEs recommended by DPE |
Credit Guarantee Scheme for the Micro, Small and Medium Scale Enterprise (MSME) Rice Mill Owners in Sri Lanka
| Purpose | Provide credit guarantee to the Participating Financial Institutions (PFIs) who are providing loans to the eligible borrowers under the Scheme for the purpose of purchasing paddy. |
| Funded by | PFIs own funds and Credit Guarantee by CBSL |
| Area of Operation | All island |
| PFI’s | Bank of Ceylon, Peoples Bank, Pradeshiya Sanwardhana Bank |
| Maximum Loan Limit & Period | LKR 25 Mn. For 9 months |
| Interest Rate | Prevailing market rate |
| Target Group | Rice mill owners whose annual turnover is less than Rs. 750 million. |
Interest Subsidy Scheme for Intensification of Shrimp Farms in Sri Lanka
| Purpose | Assist Shrimp farmers to upgrade their farms |
| Funded by | Government of Sri Lanka - Interest Subsidy Participatory Financial Institutions - Loan Financing |
| Area of Operation | All island |
| Participatory Financial Institutions | Bank of Ceylon, Peoples Bank, Pradeshiya Sanwardhana Bank |
| Maximum Loan Limit & Period | LKR 100 Mn. For 2 years with 6 months Grace period |
| Interest Rate | 1st 18 months - 4.5% Next 6 months - 8.5% |
| Target Group | Shrimp farmers |
Supply Chain Re-Energizing Loan Scheme (SCREL)
| Purpose | to provide working capital requirements for the Registered Tea Manufactures to revamp existing businesses to conclude debt restructuring plans, work out new business plan/s and modernization strategies for each tea factory and settling the existing payment arrears to suppliers to make the supply chain re-energized. |
| Funded by | Government of Sri Lanka |
| Area of Operation | All island |
| Participatory Financial Institutions | Bank of Ceylon, Peoples Bank, Commercial Bank of Ceylon PLC, Sampath Bank PLC, Hatton National Bank PLC, National Development Bank PLC, Union Bank of Colombo PLC, Cargills Bank Limited, Seylan Bank PLC, DFCC Bank PLC |
| Maximum Loan Limit & Period | the maximum loan amount granted per Registered Tea Manufacturer under this scheme is Rs.3 million for 2 years with no Grace Period |
| Interest Rate | 3.5% |
| Target Group | Tea Manufactures Registered under Sri Lanka Tea Board |
