National Credit Guarantee Institution Limited (NCGIL), a Public Limited Company (unquoted) has been established as a Public Private Partnership between the Government of Sri Lanka (GOSL) and 13 Shareholder Financial Institutions (SFIs). NCGIL is incorporated under the Companies Act No 7 of 2007 and aims to support the Micro, Small and Medium Enterprise (MSME) sector in Sri Lanka by helping MSMEs to adapt to changing market demands, technology and overcome capacity limitations due to low financial inclusion and limited access to finance especially due to lack of collateral.
The Asian Development Bank (ADB) supported the GOSL for the investment in the NCGIL and to acquire 90% of the shareholding while 13 SFIs made the balance investment of 10%. The 13 Shareholder Financial Institutions include Eight Licensed Commercial Banks (both public and private), two Licensed Specialized Banks and three Non-Banking Financial Institutions (NBFIs).
The main objective of NCGIL is to provide partial credit guarantees to the Shareholder Financial Institutions (SFIs) to encourage them to provide uncollateralized lending to the MSMEs based on the viability of the projects and their cash flows.
NCGIL has commenced the operations and now accommodating the applications from the SFIs for the issuance of guarantees for their lending to the MSMEs.