SL SME Funding Crisis: Rs. 80 Bn Risks Underutilisation 📈

Selyn Business Development Director Selyna Peiris warns that a record Rs. 80 Bn allocated for SMEs in the 2026 Budget faces severe underutilisation due to a critical "implementation gap" and structural barriers. • Core Issue: The challenge is "absorption, not allocation." Deep procedural and structural flaws prevent SMEs, especially youth and women-led ventures outside Colombo, from accessing promised support. • Budget & Target: The Rs. 80 Bn allocation (record high) is largely targeted towards Agriculture and related industries. • Evidence of Failure: Previous schemes show a worrying pattern: Low-Interest Loans (Rs. 6 Bn): Only Rs. 458 Mn was actually disbursed. Credit Guarantee Scheme (Rs. 15 Bn): Only Rs. 1 Bn was utilised. • Impact: This lack of access disproportionately hurts rural, youth, and women entrepreneurs, creating an uneven playing field. Peiris warns that this "fear" and uncertainty is driving many SMEs back into the informal cash economy. • Call to Action: Urgent focus needed on "implementation, not intention" to fix the disconnect between policy and access.