Regulatory Alerts2021-02-22
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Circular dated February 22, 2021 regarding amending some provisions of the Micro, Small and Medium Enterprises Initiative
The Central Bank of Egypt increases the mandatory allocation for micro, small, and medium enterprise (MSME) financing from 20% to 25% of a bank's credit portfolio by December 31, 2022, and mandates a minimum of 10% of this portfolio be directed specifically to small enterprises. The circular permits financing for micro and small enterprises with sales under 20 million Egyptian pounds without audited financial statements, allowing the use of alternative digital data for credit assessment. Banks must submit implementation plans by March 31, 2021, and face penalties for non-compliance with the 25% and 10% thresholds, including deposits without interest or fines under Central Bank Law No. 194 of 2020.
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