The Egyptian banking sector has witnessed significant growth in financing for small and medium-sized enterprises, with a 410% increase since 2015. According to Tarek El-Kholi, Deputy Governor of the Central Bank of Egypt, this growth is a result of the bank's efforts to increase financing for these projects. El-Kholi made these remarks at the CERISE+SPTF Global Meeting 2026, held in Egypt.
Small and medium-sized enterprises are a crucial component of the Egyptian economy, accounting for 99.3% of all businesses in the country and providing 82% of total employment. El-Kholi stated that there are approximately 3.858 million small and medium-sized enterprises in Egypt, with micro-projects making up around 80% of these businesses. The sector has seen a decline in unemployment rates, from 9% to 6%, reflecting the importance of continued support for these enterprises.
The Central Bank of Egypt has implemented several measures to increase financing for small and medium-sized enterprises. In 2016, the bank mandated that banks allocate 20% of their credit portfolios to financing for these projects, which was later increased to 25% in 2021. El-Kholi noted that the bank has given banks a deadline to comply with these regulations, after which penalties will be imposed on non-compliant banks.
The financing portfolio for small and medium-sized enterprises has seen significant growth, with a 409% increase since 2015. El-Kholi stated that the microfinance sector has also seen substantial growth, with a 1570% increase since 2016. The sector now serves over 3.9 million clients, with a total value of over 107 billion Egyptian pounds.
Women's empowerment is a key aspect of the Central Bank of Egypt's strategy to expand financing for small and medium-sized enterprises. El-Kholi noted that women-owned or managed projects account for around 24% of total financing for these projects from the banking sector. Additionally, women make up around 53% of clients benefiting from non-bank microfinance institutions.
The Central Bank of Egypt's efforts to support small and medium-sized enterprises have also included the establishment of the "Rawad El-Nile" initiative, which provides financial and non-financial services to project owners. The initiative has established 140 business development centers covering 25 governorates, providing around 1.3 million non-financial services and consultations to nearly 589,000 beneficiaries.
The Central Bank of Egypt's strategy aims not only to increase financing for small and medium-sized enterprises but also to help informal projects transition to the formal economy. El-Kholi stated that the bank has developed mechanisms to finance projects that lack financial statements or credit history, by evaluating their behavior and ability to repay.
Key points
- The Egyptian banking sector has seen a 410% growth in financing for small and medium-sized enterprises since 2015.
- Small and medium-sized enterprises account for 99.3% of all businesses in Egypt and provide 82% of total employment.
- The Central Bank of Egypt has mandated that banks allocate 25% of their credit portfolios to financing for small and medium-sized enterprises.
