Information Technology Industry Development Agency (ITIDA) signed a cooperation agreement with the National Bank of Egypt (NBE) worth 150 million EGP.
This sum is the total value of loans to be offered by NBE for supporting small and medium-sized enterprises (SME)s operating in information and communication technology (ICT).
The agreement aims at providing the necessary funds for ICT SMEs registered in ITIDA’s database and helping them get merged in bigger entities. Other purposes of this cooperation are to finance the operations related to these mergers and to collaborate in preparing training workshops in order to urge financial institutions to expand their provision of financing and non-financing services to ICT SMEs.
The agreement entails that ITIDA receives the companies’ requests of financing and selects the qualified ones. Then the agency is to inform the bank whether the company is registered in the ITIDA database, which is a main condition for receiving these loans. ITIDA is to hold collective meetings with the companies’ officials and experts from the bank to acquaint them with the available financial services included in the agreement. Moreover, ITIDA supports the companies in gaining the loans as per the agency’s rules, regulations and board decisions.
On its part, NBE is to study and offer the required financing needs of the ICT companies registered in ITIDA’s database, primarily valued 50 million EGP annually, over a period of three years based on the bank’s rules of financing SMEs. The loans are offered with a 5.5% simple interest rate. NBE determines the required documents and dates of offering the loans for the companies requesting them.
Based on the initiative, ITIDA transfers the applications to the bank after the initial approval to examine them and decide whether or not a company is qualified to receive a loan. The bank informs the agency with its decision, explaining the reasons for rejection or approval, and decides the value of the loan allocated to the beneficiaries of each program separately.
ITIDA CEO, Mr. Yasser El-Kady expresses his happiness with the partnership and cooperation with banks in financing ICT SMEs, especially NBE. He praised the role of NBE being one of the biggest operating banks in Egypt and the Middle East that has distinguished experience in dealing with different segments of companies.
On her part, Ms. Soha Suleiman, Head of the SMEs Group at NBE points out that the bank lately pays a special attention to the development of SMEs. SMEs, she adds, reached two million, 98% of the total companies operating in the Egyptian market, which contribute to about 85% of the gross national product (GNP).
Suleiman further says that not only does the bank seek to financially support SMEs, it also offers them technical consultations through a group of experts specialized in different fields to ensure the success of these projects. The bank’s clients, she adds, increased to reach 12,000 that derived LE6 billion of revenues due to supporting these projects.
Mr. Ahmed Yahia Darwish, Industry Capacity Building Director at ITIDA, confirms that the agency seeks to stress on the concept of “financial containment” to ensure the delivery of all necessary financial services that ICT SMEs need. This concept aims at supporting the companies that have clear visions and future plans to help them face any future financial pressure.
He adds that this helps ITIDA open new horizons for cooperation and partnership with the financial sector through introducing the competitive advantages of the supply and demand aspects and the consequent requirements of financing packages. Such information was introduced during a number of seminars and workshops held in cooperation with NBE, he says.
According to Darwish, ITIDA database of companies contributes much to facilitating the mission of the bank in financing the companies based on their geographical location, which helps link them to the NBE branches nationwide. This helps finish the procedures of acquiring the loans for the banks as soon as possible, he says.
Mr. Darwish, delegated by Mr. El-Kady, and Ms. Suleiman, delegated by NBE Board Chairman Mr. Tarek Amer, signed the agreement in the capacity of their positions.
