Sri Lanka govt widens low interest loan schemes

ECONOMYNEXT – The Sri Lankan government has widened a credit scheme at subsidized interest rates to promote entrepreneurship to include tourism, which was badly hit by recent bombings, and doubled housing loans.

The finance ministry said eight credit facilities under its ‘Enterprise Sri Lanka’ loan scheme that aims to create one hundred thousand entrepreneurs within a year was approved by the Cabinet of Ministers this week.

The ‘Ran Aswenna’ loan scheme that targets productivity of agriculture has been extended to cover the tourism industry, a statement said.

Entrepreneurs in tourism can borrow up to 250 million rupees to buy equipment required for water-based tourism such as motor boats.

The five million rupee housing loan granted under the Medium Income Housing Loan Scheme has been replaced with ‘Home Sweet Home’ Loan scheme with the amount increased to 10 million rupees.

“This loan could be repaid within 25 years and the borrower has to pay only 6 percent of the interest,” the statement said. The previous five-year relief on the interest has been extended to 15 years.

The finance ministry said there are 22 relief loan schemes implemented under Enterprise Sri Lanka loan schemes introduced by the government.

Among them are 17 loan schemes under relief interest, three reimbursable loan schemes and two non monetary programs.

Nearly 81 billion rupees of loans have already been approved under the relief interest loan scheme and 55 billion rupees have been granted as loans by the state and private banks.

The ‘Sihina Maliga’ loan scheme to enable migrant workers build houses has been changed to be paid in several stages and extended to include buying condominiums.

This was done as many expatriate workers enter into short term agreements of about two years, making them ineligible for loans of 10 million rupees to be paid within a period of 15 years.

This loan will also be granted to build a new house, renovate the existing house, demolish the current house and build a new house, buy land and put up a house and to buy an old house and renovate it.

A five year grace period has been given for the borrowers of ‘City Ride’ loans to repay their loans.

Loans to buy mini taxies and electronic three wheelers have been increased by 250,000 rupees to a maximum of 2.25 million rupees as vehicle prices have increased, the finance ministry said.

Students who fail to enter state universities can borrow up to 1.1 million rupees to continue their higher education at private universities at an interest of two percentage points over the Average Weighted Prime Lending Rate.
COLOMBO 31 May 2019)
 

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