Proparco to lend USD 24m for renewables, SMEs in Sri Lanka

Proparco, a subsidiary of French development agency Agence Francaise de Developpement (AFD), has provided EUR 20 million (USD 23.6m) to Sri Lanka’s DFCC Bank to support renewable energy and the small and medium enterprises (SMEs) sector in the island country.

The long-term loan will improve credit access for SMEs and at the same time allow DFCC to lift the proportion of SMEs in its portfolio, DFCC and Proparco said in a joint statement on Friday. Proparco’s CEO Gregory Clemente noted that financing SMEs represents a “key growth opportunity,” which is in line with the local government’s vision.

DFCC Bank has provided financing for the first hydropower plant (HPP) in Sri Lanka, as well as the first wind and solar parks. At present, its financial support is used for 70 HPP schemes, as well as several wind and solar projects.

In Sri Lanka renewable energy is needed to cut the country’s overdependence on fossil fuels. Earlier this month, the International Finance Corporation (IFC) said it will help Sri Lanka’s Commercial Bank of Ceylon (CBC) to boost lending for renewables and energy efficiency through USD 100 million (EUR 85m) in seven-year financing.

(EUR 1.0 = USD 1.178)

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