Kafalat loans down

Guaranteed loans drop by nine percent y-o-y in first nine months of 2011

The number of loans extended to small- and medium-sized enterprises under the guarantee of ‘Kafalat’ saw a yearly decline of more than nine percent. The number of guaranteed loans stood at 971 at the end of September 2011.

Figures released by Kafalat show that the total value of guaranteed loans reached $124 million in the first nine months of 2011, down from $128 million at the end of September 2010. The average loan size was $193,000, compared to $178,000 in the first nine months of 2010.

Beirut and Mount Lebanon accounted for around half of the guarantees offered by the program (47 percent). The South and Nabatieh, and the Bekaa areas acquired shares of 19 and 18 percent, respectively. The North accounted for around 14 percent.

Agriculture accounted for more than 40 percent of total guarantees, followed by the Industrial sector with 26 percent, the Tourism sector with 17 percent. The other guaranteed loans were extended to the Information Technology and handicrafts sectors.

Kafalat is a state-sponsored organization that provides financial guarantees for loans up to $400,000 earmarked for the set up and expansion of small and medium-sized companies in productive sectors. It guarantees up to 75 percent of the loan amount and a similar percentage of the interest that accrues during the grace period.