AFESD extends $50m credit to fund Jordanian SMEs

AMMAN — The Arab Fund for Economic and Social Development (AFESD) on Wednesday extended a $50 million credit to finance small-and medium-sized enterprises (SMEs) in Jordan, either directly or through micro-funds.

According to a statement issued by the Central Bank of Jordan (CBJ), the loan aims at empowering SMEs due to their role in supporting the economy, reducing unemployment and combating poverty. 

“The loan also aims at enabling SMEs obtain necessary financing for their operations on a medium or long-term basis and at competitive rates,” the CBJ said.

Noting that the credit comes in light of the success achieved with the World Bank loan in this regard, the CBJ indicated that the period of the lending will be ten years at an interest rate of 2.5 per cent to be charged to the banks during the loan term.

The CBJ said it will sign agreements with interested banks according to specific conditions noting that the interest rate is much lower than the cost paid by banks from other resources.  

Around $62 million of the World Bank’s $70 million loan has been extended, benefiting more than 800 small businesses, of which 62 per cent are outside Amman. 

Women constituted 57 per cent of the beneficiaries, according to the CBJ, which expressed hope that the funding of small and micro-enterprises, expected to reach $120 million, would develop the sector and improve its contribution to the social and economic development of the country.