Through an agreement with the People's Credit Bank... The National Fund for Social Aid expands sources of financing for micro-enterprises

Damascus-SANA

With the aim of finding suitable financing for the establishment of micro-enterprises, expanding the financiers with interest-supported loans, and enabling project owners to generate sustainable and growing income, the agreement was signed by the National Fund for Social Aid and the General Corporation of the People's Credit Bank.

The term of the agreement, which was recently ratified by the Ministries of Social Affairs, Labor and Finance, is five years, which can be extended with the consent of both parties, according to the Director General of the National Fund for Social Aid, Eng. Louay Al-Aranji.

Al-Aranji indicated in a statement to SANA that everyone who wishes to establish a new micro-enterprise for the purpose of producing a commodity or service in various forms or develop an existing micro-enterprise benefits from the agreement, with the presence of targeted segments, including those who have been dismissed from the service of science, and the families of the martyrs and the wounded, pointing out that the agreement contributes to providing the opportunity for Beneficiaries to obtain a low-cost financing loan, i.e. with interest subsidized by the Fund, and to help the beneficiary enhance his self-reliance in generating income to improve his social and living conditions as well as reduce unemployment by creating more job opportunities.

The agreement includes granting the bank, in accordance with its approved policies and procedures, a loan with a ceiling not exceeding ten million Syrian pounds to the beneficiary with an interest that the fund bears part of, as the interest rate reaches 5.8 percent annually for short-term loans that do not exceed a year and 9 percent annually for medium-term loans that exceed a year and do not exceed 5 years.

According to the agreement, the Fund covers a 6% interest rate as a form of social support for the beneficiary of the loan, provided that he is committed to paying the installments according to the repayment schedules. The interest bearing percentage of the fund shall be determined at the end of the previous year for the year that follows.

The loan is repaid in monthly, quarterly or semi-annual installments, according to the nature of the activity, according to the maturity schedule determined by the bank for each loan, in proportion to the beneficiary’s income and avoiding the beneficiary’s incurring additional financial burdens, provided that the grace period to start paying the installments does not exceed three months from the date of granting the loan.

In accordance with the agreement, the beneficiary shall bear fines and delay interest, as applicable to the bank, in addition to the value of the subsidized interest rate in the event of default of the loan and delay in paying any of the installments specified in the payment schedule for a period exceeding 90 days from the due date or converting the status of one of the installments into debts under settlement, whichever is closer.

Al-Aranji explained that the mechanism for implementing the agreement will be announced soon, and a date will be set for the start of submitting applications for benefiting from loans in the Fund's branches and centers in various governorates.

Al-Aranji pointed out that the Fund provides interest-supported loans to support projects to develop the Syrian countryside in agreement with the Cooperative Agricultural Bank, in addition to interest-free or subsidized loans allocated to the demobilized in accordance with the agreement signed by the Fund with the National Microfinance Corporation last year.