Development Bank of Ethiopia Set to Provide 20 Billion Birr Loan for SMEs

Addis Ababa, September 26/2023(ENA):-The Development Bank of Ethiopia has set to provide more than 20 billion Birr loans to Small and Medium Enterprise (SMEs) during the current Ethiopia fiscal year.

Countries such as Germany, South Korea, China, and Japan Small and Medium Enterprises (SMEs) are the starting point of their large economies.

According to a study conducted by the World Bank, SMEs play a major role in most economies, particularly in developing countries. 

They represent about 90 percent of businesses and more than 50 percent of employment worldwide. Formal SMEs contribute up to 40 percent of national income (GDP) in emerging economies. 

However, access to finance is a key constraint to SMEs growth; it is the second most cited obstacle facing SMEs to grow their businesses in emerging markets and developing countries.

The Development Bank of Ethiopia has been engaged in supporting SMEs  by providing training and finance with a view to tap the potential of the  sector for national economy. 

So far, the bank has provided 20 billion Birr loans to small and medium enterprises that have met the requirements. 

Media and Communication Director at the bank, Yeabsira Kebede told ENA that small and medium enterprises are a key sector that ensure  the economic benefit of citizens by providing resources to high industries and creating a wide range of employment opportunities.

Moreover, he pointed out that the bank has been working to create small and medium enterprises that play a pivotal role in ensuring Ethiopia's economic growth over the past three years.

To this end, the bank is providing continuous training to create strong enterprises led by knowledge and skills, he said, adding 133,000 citizens participated in the last four rounds of training.

He explained that it is planned to train up to 75 percent of the 320,000 enterprise operators who are waiting to take the training.

On other hand, the director said citizens seeking credit services who have received training should also submit their market feasibility ideas to the bank, noting that the bank will also work for them to start their business by providing loans.

The small and medium enterprises that started working with this loan have been successful in transforming their lives and the country, he added.

Accordingly, the bank has planned to provide 20.4 billion birr loans to enterprises that properly follow the bank's policies and submit detailed business plans this Ethiopian fiscal year.

The Development Bank of Ethiopia is a specialized financial institution established to promote the national development agenda through development finance and close technical support to viable projects from the priority areas of the government by mobilizing fund from domestic and foreign sources while ensuring its sustainability. 

Ethiopian News Agency