A successful Labour Fund (LF) initiated project to provide innovative financing support for Small and Medium Enterprises (SMEs) in the Kingdom of Bahrain has received a major boost with another financial institution joining the ranks.

The Bahrain Development Bank (BDB) and Labour Fund have signed an agreement to provide financing tailored to meet the needs of SMEs in Bahrain, said an official spokesman.

Bahrain Development Bank has joined the Labour Fund project as partner and will add its financial clout and resources to the project. Under the agreement signed by the Labour Fund's acting CEO Abdulellah Al Qassimi and Bahrain Development Bank's CEO Nedal Al Aujan, the bank, which is structured to assist industrialisation, SME projects and develop entrepreneurial projects, will offer finance and expertise to SMEs and entrepreneurs wishing to expand their business.

The key aspect of the scheme will be low-interest business loans including packages ranging from BD5,000 ($1,890) to BD250,000 which will increase the amount of financing that will be available for business development and growth.  The financing is accessible to SMEs on a first come first serve basis.

"We are delighted that more financial institutions are coming on board with the Labour Fund  to strengthen the SMEs and entrepreneurial ventures in the Kingdom," said Labour Fund's Abdulellah Al Qassimi.

"The synergy created by such participation will undoubtedly help to realise our vision of a powerful industrial and business sector that will raise standards of living, encourage participation in the Kingdom's growth and create new avenues of employment for Bahrainis."

In total BD10 million will be made available over the two years life cycle of the initiative. This vital step comes as part of the BDB’s effort to support the private sector and the SME segment, along with the Labour Fund's ongoing efforts towards a labour market reform, which is an essential step towards improving the performance of businesses.

"Assisting businesses and SMEs to grow is a key area of expertise at the BDB and through the Labour Fund we can reach those who specifically need such resources to realise their vision for a bright future. Like the LF, we share our vision that SME-related projects help to develop the Kingdom and we are looking forward to working with SMEs and businesses with the LF," said BDB's Al Aujan.

The financings are being further subsidised by the Labour Fund, with recipients being given a generous tenor of up to 10-years to repay them. 

Eligible SMEs must show strong potential and be at least one year old. They will need to submit their audited accounts to the bank and business plans may also be required for financings above BD50,000. Applicants must have good credit histories.
The BDB is offering a streamlined application system, which allows eligible requests to be quickly and efficiently processed. SMEs can apply at BDB's main office or branches. – TradeArabia News Service