Improving Access to Finance for MSMEs in Palestine
A high-level roundtable discussion was organised in Ramallah on 8 February 2017 on “What is needed from the financial sector to play a greater role in accompanying entrepreneurs and SME growth in Palestine?” This event was organised by the Ministry of National Economy in collaboration with the Enhancement of the Business Environment in the Southern Mediterranean project (EBESM). Actions needed to enhance financial inclusion for Palestinian MSMEs (micro, small and medium enterprises) were discussed.
Policymakers including the Ministry of National Economy (MoNE) and SMEs Technical Committee chaired by the Palestine Monetary Authority (PMA), financial institutions such as Commercial and Islamic banks, Venture Capitals and Microfinance Institutions, representatives of the private sector including the Palestinian Federation of Industries, the Federation of Chambers of Commerce, Industries, and Agriculture, think tanks, academia and civil society as well as entrepreneurs and EU experts discussed solutions to enhance access of Palestinian businesses to finance, based on the the results of the EBESM study entitled “Assessment of Palestinian Policies to Facilitate Access to Finance for MSMEs"
In addition, during this seminar major achievements of the MoNE and SMEs’ Technical Committee were presented, in particular: the Law of Secured Transactions which was issued in April 2016, which established the legal grounds and modern systems to regulate the use of movable assets as collateral. The movable assets registry is set and managed by MoNE, and currently the instructions to implement the registration where launched. During this process, the SMEs Technical Committee provided full support in issuing the registry law and in testing the registry system.
The SMEs technical committee set by the Palestinian Monetary Authority in 2013 achievements where presented, exemption of obligatory associated reserves; adoption of a unified definition of SMEs by the cabinet and extended by the PMA to banks; reduction of borrower down payment delay fines; and exemption for the banks from allocating 2% to the PMA obligatory reserves, if guaranteed.
Furthermore, participants discussed policies and measures needed to overcome challenges that are still hindering MSMEs access to finance in Palestine and help businesses to grow, be more competitive and create jobs.
As a follow up to this roundtable, priority actions, identified by stakeholders, will be kick-started with the technical support of the EBESM Project, such as modality of innovative guarantee fund and export financing schemes.
For further reading, please consult the following documents.
|EBSEM A2F Key findings Palestine||EN|
|EBSEM A2F Recommendations||EN