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Central Bank of Egypt to Support ‘Financially-Distressed’ SMEs

A new CBE announcement intends to ease the red tape around SMEs, giving small businesses an extended time frame to bounce back before being officially classified as ‘financially distressed’.

Looking to alleviate the impact of the pandemic on small and medium-sized enterprises (SMEs), the Central Bank of Egypt (CBE) has introduced a new set of regulations that will give financially distressed businesses a great number of ways to settle their debts, as well as more time to do so.

The new decisions would ease the red tape around SMEs, giving small businesses an extended time frame to bounce back before being officially classified as ‘financially distressed’. Credit facilities will also be reorganized based on their available capital and capacity to pay. The tenor of their facilities may also be extended, alongside grace periods for payments.

These are just some of the many measures that the CBE has been implementing to ease since it launched its financial inclusion strategy in 2019.

While SMEs are given a measure of leniency, the CBE looks to tighten regulations on the way banks manage non-performing loans with a unified regulatory framework across all of Egypt’s banks, which includes establishing clear timelines for classifying loans as bad debt.




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