$175m in Guarantees for SMEs in 9 Months
EghtesadOnline: In the first nine months of current fiscal to Dec.21, almost 1.4 trillion rials ($175 million) in guarantees was issued or extended by the SMEs Investment Guarantee Fund.
According to the IGF website, the fund issued 84 guarantees worth 65.4 billion rial ($6.4 million) and extended the validity of 134 existing guarantees worth 771 billion rials ($7.5 million) in the first nine months of current fiscal that ends in March.
Credit guarantees issued to launch industrial units stood at 268 billion rials ($2.6 million). Also, 264 billion rials ($2.5 million) in credit guarantees were issued in the form of working capital for SMEs.
The data ranked Sina Bank, Post Bank, and Bank Sepah as the three main lenders with respect to the guarantees (279 billon rials ($2.7 million), 126 billion rials ($1.2 million), 51 billion rials ($500,000), respectively, Financial Tribune reported.
Kermanshah, Fars, and South Khorasan were among the provinces that received the highest amounts in guarantees for the SMEs.
According to IRNA, Mohammad Hossein Mogheise, the IGC director, had earlier voiced concern about the capital shortage of the fund and its bleak prospects if enough funding is not made available.
”The value of guarantees issued is six times over and above our capital. We need money to be able to survive.”
He said new guarantees would not be possible without new cash infusions while “the current economic conditions demand more support be made available provided for the small and medium-sized enterprises.”
Reviewing the performance of the fund in the previous fiscal, he said the value of guarantees rose 43% last year mainly for SMEs in underprivileged regions.
Data show there are over 70,000 SMEs active in the country accounting for 93% of the total active industrial units. SMEs account for 10% of the total Iranian exports.
As a state organization affiliated to the Ministry of Industries, Mining, and Trade, the IGF was founded in 2006. It has a mandate to help SMEs develop by guaranteeing a maximum 70% (85% in less developed areas) of the principal amount plus interest.
The lending is mainly for construction and renovation projects, working capital, buying technology and technical knowledge, and human resources development plus R&D.