Egypt—National Bank of Egypt: MSME Lending Capacity Building

Loans to micro, small, and medium-sized enterprises (MSMEs) account for only 6 percent of the total loan portfolio of Egyptian banks, well below the 10 to 30 percent documented in the countries of the Organisation for Economic Cooperation and Development. The Government of Egypt and Central Bank of Egypt have made access to finance for MSMEs a top priority and key area for banking sector reform.

The National Bank of Egypt is the oldest and largest commercial bank in Egypt wholly owned by the Egyptian government. With a nationwide network of more than 300 banking units and dedicated small and medium-sized enterprises (SME) department with nearly 1,000 employees, the bank is a national leader in SME finance. DAI is assisting the bank to increase its microfinance and broader MSME portfolio.

Sample Activities

• Review strategy, provide recommendations, and assist with the implementation of measures for expanding MSME lending and risk management.
• Assess the feasibility of setting up a separate microfinance business unit (in-house vs. specialised subsidiary), provide recommendations, and assist with the development of micro-lending.
• Provide recommendations and assist with the implementation of credit scoring, to perhaps include development of a scorecard, time-bound programme, and automated application processing.
• Help develop an MSME Advisory Services Unit to support MSMEs in financial management, applying for and servicing loan products, and other needs.