USAID & LOLC in a Partnership to Uplift Micro Finance Sector of Sri Lanka - 22 Sep 2006

LOLC, the Pioneer of Leasing and factoring in Sri Lanka and a leading financial solutions provider in Sri Lanka has entered into an agreement with USAID, whereby USAID will provide a loan portfolio guarantee of US$ 3 million. It is the first Development Credit Authority (DCA) credit Guarantee granted by USAID to a non banking financial services organization in Sri Lanka. USAID has been in operation in Sri Lanka for 50 years now and has invested more than US$ 2 billion in many areas of development within the country. The credit guarantee will provide LOLC with an opportunity of lending more aggressively to the rural community at the grass root level and enable them to actively address the needs of the micro finance sector.
 
Since its inception in 1980 as a result of a joint venture between the ORIX Corporation of Japan and the IFC, LOLC has made a vital contribution to the capital markets of Sri Lanka and in 2003, the company actively ventured into the Micro and Agro finance sector. The company recently realigned its business strategies to provide customer centric solutions and increase synergy amongst the group companies, thereby transforming itself into a Total Financial Solutions Provider. Having considered the track record, solid business direction, transparent governance and strong financial profile of the company many prominent multilateral agencies were keen to partner LOLC in its initiatives in the Micro & Agro finance and SME sectors. The company has made a significant contribution to all these areas and hopes to increase its involvement and focus on these sectors during the ongoing year. LOLC has a geographically widespread branch network, which enables it to reach customers all around the country.
 
The US$ 3 million loan portfolio guarantee covers micro, small and medium sized businesses in agriculture, tourism, fisheries and alternative energy sectors. Initially this credit guarantee will cover the loans made in the Eastern, North Central and tsunami affected areas of the Southern province.
 
"The fact that we have received this Credit Guarantee from USAID bears ample evidence of the reputation LOLC has earned internationally as being a catalyst in the Micro & Agro Finance Sectors. Our contribution to these sectors has assured the multilateral agencies of the benefits the rural community will receive, and also the stability of the company in providing Total Financial Solutions to the people," said Mr.Ravi Tissera, CEO of Micro Finance.


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