Morocco's Central Guaranty Fund to guaranty VSE loans
The Central Guaranty Fund will extend its field of intervention to very small enterprises with a new tool called Damane Express.The Central Guaranty Fund (CCG) will extend its field of intervention to very small enterprises (VSEs) with a new tool called Damane Express.
Its objective is to facilitate access to credit for companies employing less than ten people through a 70 percent reduction on the risk taken by banks on loans smaller than 1 million dirham (€90,500), Le Matin newspaper reports.
This guaranty covers 18-month short-term loans renewable a maximum of five times, on all sectors apart from real estate and deep sea fishing.
VSEs represent 98 percent of companies and are one of the pillars of the country's economic development. They currently struggle accessing finance, as they are often not able to provide the necessary guaranties.
According to the Finance Ministry, this initiative will benefit 90 percent of VSEs and will complement the 2011 new fiscal measures, reducing tax rate for businesses by half - going from 30 percent to 15 percent for this type of company.
The government introduced in 2010 a law to support the creation of VSEs suppressing the requirement of a minimum social capital for the creation of an Ltd and simplifying the business creation process for companies with a capital of less than 100,000 dirham, Aujourd'hui Le Maroc reports.
The CCG went from a commitment level of 4.8 billion dirham in 2010 to 5.29 billion dirham in 2011 and targets more than 6 billion dirham in 2012.