The Central Bank has unveiled a new set of guidelines aimed at simplifying loan access for Small and Medium Enterprises (SMEs). The move comes as part of a broader strategy to stimulate economic growth and support grassroots businesses, particularly in the wake of recent financial strain caused by inflation and global market disruptions. The new framework is expected to create a more transparent, streamlined borrowing process for entrepreneurs.

According to officials, the guidelines will ensure better regulation of lending institutions, compelling them to adopt fair interest rates and provide clearer loan terms to SMEs. In addition, the Central Bank has mandated financial institutions to reserve a minimum percentage of their lending portfolio exclusively for SMEs. This provision is expected to ease long-standing complaints about the limited availability of business credit.

One of the most notable features of the new guidelines is the introduction of digital monitoring tools that allow real-time tracking of loan disbursement and usage. The Central Bank says this initiative will help prevent loan diversion and ensure that borrowed funds are utilized for the intended business purposes. It also aims to reduce default rates by encouraging responsible borrowing and lending.

Business owners and stakeholders have welcomed the development, describing it as a timely intervention. “This is the kind of reform SMEs have long needed,” said Maria Küng, a Swiss entrepreneur in the food processing sector. “It will reduce red tape and open up funding opportunities that were previously out of reach for many of us.” Financial analysts also see this as a signal of the government’s commitment to SME development.

The Central Bank has set a 90-day window for all commercial banks and microfinance institutions to align their lending policies with the new directive. Regular audits and compliance checks will be enforced to ensure adherence. Entrepreneurs are advised to engage with certified financial advisers to better understand the implications and requirements under the new SME loan framework.