MNT 30 billion will be given as loans to support small and medium enterprises (SMEs). Of this, MNT 10.5 billion will be spent in 21 provinces, MNT 5 billion in UB, MNT 5 billion for leasing loans, MNT 9 billion for financial source for regional characterized industries and MNT 1.5 billion for loan guarantee.

Vice Minister for Food, Agriculture and Light Industry B.Zoljargal and director of Light Industry Department of the ministry D.Badarch and director of Small and Medium Industry Department M.Bayarmagnai said the originally allocated MNT 7 billion for UB had to be reduced to provide for a loan guarantee fund.

Criteria for granting loans to SMEs were relaxed this year. The new procedures include the following:

–          Sub-commissions will be established to select projects. They will decide on every application within 10 working days.

–          Loans will be given by four commercial banks. The banks will release the loans within 14 days of the decision of the sub-commission.

–          All unencumbered property can be mortgaged.

–          If Metropolitan businesses apply for a loan over MNT 100 million, and provincial businesses for over MNT 50 million, the request must be given to the Ministry of Food, Agriculture and Light Industry.

The loan guarantee fund will allow more people to apply for loans. The above changes were made considering the requests and proposals of the citizens. Last year’s experience showed that loans must be given early. Thus, officials are advising people to start submitting their project proposals to the sub-commissions as soon as possible. It is planned that the loans will be given starting May.

The four commercial banks are Government Bank, Khaan Bank, Khas Bank and Savings Bank. Contracts will be made with the banks next month.

According to the Vice-Minister B.Zoljargal, all the provinces will be given equal amount of money.