In Sri Lanka, SMEs account for 70% of all businesses, employ 26% of the active population and contribute 52% of GDP. They therefore represent a key growth sector for the new Sri Lankan government which recently stressed the key role of banks in providing them with financing. DFCC will be able to use this loan to boost the proportion of SMEs in its portfolio – which already stands at nearly 50%.
It will also enable Proparco to support a stakeholder who is already active in financing renewable energy : DFCC financed Sri Lanka’s first hydro power project back in 1996, the country’s first wind farm in 2010 and its first solar power plant in 2015. The bank is currently providing funding for 70 hydro power projects, 3 wind farms and 2 solar energy projects as well as a biomass project.
DFCC is the seventh bank that Proparco has done business with in Sri Lanka. This renewed commitment will enhance the ability of local financial institutions to invest in key development sectors.