FILE- The new system will facilitate funding to SMEs.
CAIRO – 11 March 2018: Minister of Investment and International Cooperation Sahar Nasr launched on Sunday the movable guarantees registry system, which provides small- and medium-sized enterprises (SMEs) with an additional funding tool.
It offers projects the chance to obtain financing by guaranteeing machinery and equipment, patents and engineering designs, Nasr said.
The new tool will help merging the informal economy with the formal one. It will also help the SME sector to grow as it will facilitate funding to these projects.
Nasr said that the movable guarantees registry system will help in achieving financial inclusion and improve Egypt's ranking in the World Bank's Doing Business report.
There are a total of 2.4 million small and micro-sized enterprises across Egypt with 6.3 million workers, according to a 2016 study by the Central Agency for Public Mobilization and Statistics (CAPMAS).
Prime Minister Sherif Ismail said last year that the country’s informal sector is worth LE 1.6 trillion.
In 2016, the Central Bank of Egypt (CBE) has announced an initiative to finance SMEs. Under the initiative, 20 per cent of bank loans should be allocated to SMEs within four years.
Total loans that banks issued within the initiative currently amounts to LE 67 billion, head of banking development sector at CBE Mostafa Mounir said last week. Some 61,000 companies have benefited from the funding since February 2016.
He said that the CBE has allocated LE 100 million over five years to build business development centers, in cooperation with Nile University, to provide consultancy services to the SME sector.
The CBE also targets to establish 40 business development centers across the country before year-end.