1. To promote the development of micro, small and medium-sized enterprises (MSMEs), the MSME Development Fund has been established with capital contributed by the State. Loans from the fund are being provided to MSMEs in the Nay Pyi Taw Union Territory and regions and states at concessional interest rates through Myanma Economic Bank, Myanma Agricultural Development Bank and 16 private banks, either against collateral or under the Credit Guarantee Insurance (CGI) system.
2. Entrepreneurs wishing to obtain MSME loans must apply for loans at the relevant Township/District MSME Agencies. The terms and conditions for MSME loans are as follows:
(a) Maximum loan amount for an MSME Micro and small enterprises — up to K50 million Medium-sized enterprises — up to K100 million Loans under the CGI system — up to K50 million (Myanma Insurance, three private joint-venture general insurance companies and six domestic private general insurance companies
(b) Loan types and interest rates Loans for which at least 30 per cent of the funds will be used for fixed capital: maximum loan term of three years; interest rate – 3 per cent. Loans for which 100 per cent of the funds will be used as working capital: maximum loan term of one year and six months; interest rate – 4 per cent. Loans provided under the CGI system: interest rate – 5 per cent. (Borrowers obtaining loans under the CGI system will be required to pay the CGI premium in addition to the 5 per cent interest rate.)
(c) Types of collateral that may be submitted for loans · Land and buildings · Machinery and equipment · Savings certificates · Government treasury bonds · Fixed deposits (term deposits) · Pledgeable securities · Credit Guarantee
(d) Types of land accepted as collateral Ancestral land, land grant, Lana (39) Land, (3) (a) Land, Laya (30) (a) (b) Land, Farmland use certificate form (7), industrial/business grant
(e) Types of buildings accepted as collateral Reinforced concrete (RC) buildings, brick-and-concrete buildings, masonry buildings, brick-enclosed garage buildings, steel structures, condominium units in buildings of six storeys or above
3. Therefore, MSME entrepreneurs wishing to obtain loans from the MSME Development Fund may apply for loans by submitting eligible collateral. Those unable to provide collateral may apply for loans under the Credit Guarantee Insurance (CGI) system for a maximum amount of K50 million.
MSME Development Fund Management Body