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AfricaMoney | June 27, 2017

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MCB & SBM continue to be the major Mauritian banks funding SME growth

MCB & SBM continue to be the major Mauritian banks funding SME growth

MCB & SBM were the banks favoured by Small and Medium Enterprises in Mauritius, with the former accepting 1,756 applications to the tune of Rs 2.5 billion, representing a 49.5% share in SME funding, while the latter accepted 987 applications for an amount of Rs 927.3 million.

The Mauritius Commercial Bank (MCB) captured the highest share among Mauritian SMEs in terms of providing credit facilities under the SME financing scheme, according to a report released by the Bank of Mauritius for the period 1st December 2011 to 30th June 2015.

Total loan applications across all banks amounted to Rs 6.4 billion, of which 181 applicants were rejected and 79.1% of applications were sanctioned for an amount of Rs 5.1 billion.

Incidentally, the Mauritius Post and Cooperative Bank (MPCB) rejected the maximum applications, with the 50 applicants rejected representing 20.5% of applications received during the period under review.

The MCB was the preferred bank for SMEs, which received 1,786 applications for an amount of Rs 3.3 billion and accepted applications to the tune of Rs 2.5 billion, representing a 49.5% share in SME funding.

SBM ranked second in the list with 1,029 application received for an amount of Rs 1.1 billion, of which Rs 927.3 million was approved.

Other banks, namely the Bank of Baroda and The Hongkong and Shanghai Banking Corporation Limited, received requests to sanction Rs 154.1 million and Rs 187.4 million respectively as loan applications, and all the loan applications received were approved by both banks.

The amount outstanding as at end-June 2015 stood at Rs 1.7 billion and MCB, SBM and Barclays recorded the largest amount of outstanding loans from SMEs.

On the breakup of facilities in terms of nature of financial assistance, loans comprised the bulk of all sanctioned facilities at Rs 2.2 billion, overdrafts came next at Rs 2.0 billion, followed by finance lease facilities at Rs 260.9 million.

It may be noted that, under the recent budget announcement for 2015-16, the government is showing a concerted focus on growing the SME sector. The latest budget announcement on the launch of a dedicated SME Bank to provide seed capital to entrepreneurs without any need for personal guarantees shows the determination of the government to encourage entrepreneurship in the island economy, and nurture SMEs through provision of much-needed capital.

Finally,the Mauritian central bank also released its monthly bulletin indicating that, on the international economic front, the US economy contracted at a seasonally adjusted annual rate of 0.2 per cent in the first quarter of 2015. Meanwhile,data releases in the Euro zone pointed to a strengthening of its economic recovery following the improvement in the first quarter. Currency markets in June 2015 were volatile due to the high level of uncertainty related with the Greek debt situation and mixed economic data releases in major economies.

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