Business

BOC to break negative cycle and grow its SME loan book by Rs. 5 billion-and counting

Published

3 years ago

2023/08/11

Thilina Walpola

Rs. 4 billion for SMEs Rs. 1 billion for startups

Interest rates as low as 12.0- 12.5% over 5 years 5% below market rates

By Sanath Nanayakkare

The Bank of Ceylon (BOC) yesterday called a press conference at a short notice to break good news for Sri Lanka’s SME sector, women-led businesses and startups hungry for capital to give impetus to their growth plans after Sri Lanka has gone through a tough cycle of crises.

The Bank has just rolled out an SME fund of Rs. 5 billion at 12.0 -12.5% interest rates which the Bank said would certainly increase if there is more demand from the businesses to take their businesses to the next level.

BOC Chairman, President’s Counsel Ronald C. Perera addressing the media at BOC head office said,” As you know the past few years have been a huge challenge for the whole country including the banking sector. The interest rates went up sky-high and now after the domestic debt optimization (DDO) interest rates have started coming down. We are hopeful it will kick off the business sector so that entrepreneurs will be able to borrow funds at reasonable rates to carry out their commercial activities.

We at the Bank of Ceylon have especially thought about the Small and Medium Enterprise sector (SMEs) not only in the western province but also in all other provinces because they are the backbone of the economy of the country. Before the DDO was announced, interest rates hovered around 25-28%, and by August 9, 2023 it had come down to 16.9%. Now we have worked out a special SME loan scheme totaling Rs. 5 billion to be disbursed at 12% which is 5% below the market rate. Each qualifying SME in this loan scheme can seek a loan up Rs. 25 million. If they have collateral, they will get their loan at 12% and those without collateral will get it at 12.5%. According to the demand, we will certainly increase the SME loan volume beyond Rs. 5 billion. Let’s first see how things would turn out in the initial phase.”

“Further, there is another loan scheme to support the startups with up to Rs. 2 million rupees at the same interest rates. Both these loans are given for 5-year periods. We are looking to give priority to young entrepreneurs and businesses headed by women. We have allocated 4 billion rupees for SME loans and 1 billion rupees for the startups. This means a total of Rs. 5 billion will be disbursed in this exercise. We hope it will help drive SMEs catering to the local market as well as export-oriented SMEs and startups that need financing to grow into the next phase. The fund allocation will be implemented in a first-come first-served basis. One customer can get only one loan under this category.

This financing is provided for new businesses and not for settlements or re-pricing of existing businesses. We will abide by the normal banking practices stipulated by the Central Bank such as getting CRIB reports of borrowers and guarantors. The applicants must demonstrate that they have necessary qualifications and experience in the relevant field and have a valid business registration. They need to be able to produce environmental compliance reports etc., in case it would be required.

The borrowers would be required to provide 25% equity of their respective projects. We will not permit the purchase of land or vehicles under this scheme, but the funds can be used to put up infrastructure with the approval and due diligence by the Bank. The applicants have to come up with a business plan to show how he or she will maintain the operational activities of the business and the cashflow in a stable manner.”

“These loan schemes have just rolled out this week. Actually this was initiated after the government and the Central Bank asking us to reduce interest rates and support the economic recovery as the time is right to do so. In fact, we have gone beyond the desired levels and are offering these loans 5% below the market rate.”

“There are already a number of other SME financing facilities given at concessionary interest rates which had started earlier. In addition to that, we provide non-financial assistance to SMEs under the BOC SME Circle. It gives them the know-how to operate their businesses successfully and to expand their businesses,” BOC Chairman said.

BOC General Manager/CEO Russel Fonseka said that the Bank was able to safeguard their customers during the multiple crises and when the interest rates shot up to very high levels, because they didn’t shift that burden on to their customers, but absorbed that loss into the Bank and provided a cushion for the troubled businesses.”

“That was how BOC able to keep its customers battling the economic crisis to survive and to keep our non-performing loans (NPLs) at a very low level. We have always stayed true to our core value of ‘thin margins, high volumes’ which has worked for the benefit of the Bank, its customer base and the overall economy,” the GM said.

All News Advertisement

Related Topics:SME loan book The Bank of Ceylon

Up Next

Smart Factory Turnaround, to provide significant bottom-line improvements

Don't Miss

‘Watch all the action of Lanka Premier League 2023 on Dialog Television and on the Dialog ViU App’

Click to comment

Business

Samagi Spice Exports to launch Ceylon Cinnamon based beverage range

Published

4 hours ago

2026/10/16

Priyan

The SPICEUP range of Cinnamon based beverages being launched by Samagi

Samagi Spice Exports (Pvt) Ltd is set to introduce SPICEUP, a new Sri Lankan beverage brand, at its grand launch on Saturday 17 October 2026 at the University of Ruhuna, Matara.

With a history dating back to 1969, Samagi Spice is taking a new step in its business journey by expanding beyond traditional spice exports into value added consumer products.

Through SPICEUP, the company aims to connect Sri Lanka’s internationally recognized cinnamon heritage with contemporary beverage innovation, creating a distinctive identity in the country’s beverage market.

The SPICEUP range will feature a variety of products, including Original, Cream Soda, Power, GO, Cool, Burn, Memo+ and Zingy. Designed to offer consumers a range of refreshment experiences, the products will be available in two packaging formats: cans and plastic bottles, catering to different consumer preferences and occasions.

At the heart of the initiative is the potential of true Ceylon cinnamon as a value-added ingredient in the beverage industry. Rather than limiting cinnamon to its traditional uses, SPICEUP seeks to explore new opportunities for bringing this iconic Sri Lankan spice into everyday consumer experiences.

The initiative also highlights the broader potential of transforming the country’s agricultural resources into innovative products with commercial value.

The launch ceremony will be attended by legendary Sri Lankan cricketer Sanath Jayasuriya as the Chief Guest, alongside representatives from the Export Development Board (EDB), Industrial Development Board (IDB), Cinnamon Research Academy and other industry stakeholders.

A major highlight of the occasion will be the official unveiling of the SPICEUP product range, followed by the launch of the brand’s official website. The event will also feature the signing of a Memorandum of Understanding (MoU) between Samagi Spice Exports and the University of Ruhuna, marking an important step towards strengthening collaboration between industry and academia.

The proposed collaboration will provide a platform for future research, product innovation and value addition involving true Ceylon cinnamon. By bringing together business expertise and university-based knowledge, the initiative aims to support the development of innovative, value-added products and contribute to Sri Lanka’s potential in international markets.

With its roots in the country’s spice industry and its ambitions in the beverage sector, SPICEUP is poised to begin a new chapter in Samagi Spice’s journey—one that seeks to bring the distinctive identity of Ceylon cinnamon to a new generation of consumers.

Business

Indian business leader urges SL entrepreneurs to tap into India’s rapidly expanding consumer market

Published

20 hours ago

2026/10/16

Thilina Walpola

T. Krishnakumar, Chief Executive Officer of Reliance Consumer Products Ltd (RCPL)

By Sanath Nanayakkare

Speaking at the Sri Lanka Economic and Investment Summit 2026, T. Krishnakumar, Chief Executive Officer of Reliance Consumer Products Ltd (RCPL), emphasised that local enterprises can unlock substantial economic benefits by strategically aligning with India’s booming consumer base.

Addressing business leaders and policymakers at the Shangri-La Hotel in Colombo, Krishnakumar highlighted that geographical proximity and rich cultural ties provide a natural foundation for deeper commercial collaboration.

He noted that instead of viewing bilateral trade narrowly, regional partnerships should act as conduits to build robust, scalable enterprises capable of plugging into wide-reaching regional value chains.

“For Sri Lankan exporters dealing in traditional staples as well as value-added goods, accessing India’s rising middle class presents a phenomenal growth window,” he said.

Drawing insights from Reliance Consumer Products’ rapid expansion – which scaled efficiently to thousands of employees and multi-billion-dollar metrics – Krishnakumar stressed that modern corporate success relies on disciplined execution, localised consumer understanding, and smart technology integration.

Furthermore, he underscored that while rapid growth is critical, businesses must consistently anchor their models in affordability and consumer trust.

Concluding his address at the summit, the RCPL chief noted that pairing regional trade integration with resilient business practices and predictable regulatory frameworks will be vital as Sri Lanka transitions firmly toward accelerated economic development.

Addressing the Summit during a subsequent fireside chat, President Anura Kumara Dissanayake underscored that a core concern currently being targeted by the government is developing a critical mass of local entrepreneurs equipped to engage with international enterprise counterparts.

Business

SriLankan Airlines wins prestigious SATA 2026 Visitors’ Choice Award for Leading International Airline

Published

20 hours ago

2026/10/16

Thilina Walpola

SriLankan Airlines has once again been honoured with the prestigious Visitors’ Choice Award for Leading International Airline at the South Asian Travel Awards (SATA) 2026, reaffirming its continued recognition in the regional travel and tourism industry. The airline, which has received this award in previous years, was the only international airline to be recognised in this category at this year’s event. The 10th anniversary edition of the awards ceremony was held earlier this month at Hotel Barcelo Nasandhura in Male, Maldives.

Recognised as one of the key events on the Maldivian tourism and travel industry calendar, SATA celebrated its 10th anniversary on a grand scale, bringing together prominent industry stakeholders, including Government Ministers, distinguished dignitaries, diplomats and senior representatives from leading airlines and their respective head offices.

Commenting on the achievement, Dimuthu Tennakoon, Head of Commercial, SriLankan Airlines, stated, “We are honoured to receive this recognition at the South Asian Travel Awards 2026. Being named the Leading International Airline in the Visitors’ Choice Awards once again is a meaningful acknowledgement of our commitment to serving our passengers and strengthening our presence in the region. This award inspires us to continue enhancing the travel experience we offer and to build stronger connections with the markets and communities we serve.”

Complementing its commitment to service excellence, SriLankan Airlines offers an extensive flight network with convenient connections to destinations across the globe. In South Asia, the airline operates nearly 130 flights each week to 15 destinations across India, Pakistan, the Maldives, Nepal, and Bangladesh. With schedules thoughtfully designed to suit the needs of travellers, SriLankan Airlines provides seamless connectivity for those visiting Colombo for business or leisure, as well as passengers travelling onwards to destinations worldwide.