Members of the business sector gather for a photo session with the Minister of Industry and Commerce, Mr Malaythong Kommasith, while attending the official launch ceremony for “Matching Grant” on Monday.

Govt targeting expansion of MSME sector, decreasing non-performing loans

The Small and Medium-sized Enterprise (SMEs) Promotion Fund on Monday launched “Matching Grant”, a new promotional scheme to upgrade technologies and boost innovation.
The new grant is part of the SMEs Promotion Fund and is designed for new start-ups, enterprises, cooperatives and associations that wish to expand or buy new technology devices and innovations for their businesses. 
The launch ceremony for the scheme was presided over by the Minister of Industry and Commerce, Mr Malaythong Kommasith, and attended by senior ministry officials. Representatives of the public and private sectors joined the event in-person and virtually. The SMEs Promotion Fund is under the SMEs Promotion Department of the Ministry of Industry and Commerce.
The goals of the project were highlighted at the event, along with procedures and ailments of Micro Small and Medium Enterprise (MSMEs), the producers’ groups and business associations. The event also publicised the scope of the project for MSME promotion units across the country.
As the country grapples with economic difficulties, the MSMEs promotion scheme has already been included among the top priorities of the national agenda for 2021-23. This is aimed at achieving visible results through plans that allow entrepreneurs to access funds with lower interest rates and promote the business sector to produce more goods.
In relation to this goal, the government pledged 200 billion kip during 2020 and provided an additional 100 billion kip to the project last year. About 200 billion kip was provided this year.
More than 91 percent of the funds were allocated to various commercial banks to enable borrowers to access funds at low interest rates. The rest of the funds were used for capacity-building and administration work.
In his remarks, Mr Malaythong said the government perceives the MSME sector as a key factor for the growth of the Lao economy, especially for its contribution to creating jobs.
“Over the past few years, a number of businesses successfully accessed the available funds but many of them are unable to obtain finances because they lacked assets for bank assurances and did not meet other criteria set by the bank,” he said. The newly launched matching grant scheme will help boost business expansion, he added.
The eligible recipients of grants will be enterprises, cooperatives and business associations with legal business licenses or those acknowledged by relevant authorities.
Business units will be required to contribute 50 percent of the matching grant, while cooperatives and business associations will have to contribute 30 percent.
The grant will be open to applicants four times a year and details of the application process are available at www.laosmefund.org or on the Facebook page of the SMEs Promotion Fund.

By Times Reporters
(Latest Update September 6, 2022)