Wednesday, October 21, 2020

One to Watch, NMB Bank, Laxmi Bank, and SDC join forces to support MSMEs

 One to Watch, with support from the Swiss Agency for Development and Cooperation (SDC), and in partnership with NMB Bank and Laxmi Bank, has announced the launch of Covid-19 Micro, Small and Medium Enterprises (MSME) Fund Nepal.

The fund seeks to support MSMEs that are struggling to cope with the challenges brought forth by Covid-19. It will do so by providing them with bridge financing in order to meet the working capital needs and technical assistance in the form of business development services to be able to retain employees, preserve business continuity, and build resilience. The fund is expected to support up to 100 MSMEs continue their businesses and help them retain up to 1000 jobs, according to a press note issued by the One to watch.

The fund will provide collateral-free loans to MSMEs that are evaluated to have the potential to bounce back based on a pre-determined set of criteria. It will pay interest on such loans for a period of up to 18 months. Additionally, a subset of such firms will also be provided with business development support that are tailored to meet the needs of beneficiary enterprises, it claimed.

“In unprecedented times like these, the Fund will leverage One to Watch’s expertise in investment and business development, its robust network of investors and entrepreneurs to identify and support high-impact SMEs,” managing partner of One to Watch Suman Joshi said, hoping that the initiative will be a ‘pilot’ that can be scaled with participation from more bank partners.

“Micro, Small and Medium Enterprises are the backbone of Nepal’s economy,” ambassador of Switzerland to Nepal Elisabeth von Capeller said, adding that the MSMEs employ a large share of the workforce and are drivers of innovation and new job creation. “Their rebound, therefore, will set the foundation for overall economic recovery.”

As a long standing development partner of Nepal, SDC is proud to be able to support this initiative together with private sector partners, she added.

“As a Retail and MSE focused bank, we are hopeful this collaboration will directly benefit credit-worthy smaller entrepreneurs, who require access to bank loans in order to sustain their businesses and livelihoods during an economy under stress,” Laxmi Bank chief executive officer Ajaya Bikram Shah said, adding that the MSMEs need special attention and support at this point in time and this sector will play a key role in helping the economy revive and regain momentum over the medium and long term.

“NMB Bank is focused on sustainable banking and MSMEs are key drivers for sustainable growth of the economy,” chief executive officer of NMB Bank Sunil KC said, adding that businesses across a range of economic sectors, especially MSMEs, are the most vulnerable and facing losses. “To support their revival plan, NMB, as a partner bank, is committed to providing collateral-free loans to those highly impacted by the current crisis.”

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