BoC, a great boon to the Small Businessman

Lynn Ockersz

LENDING: The Bank of Ceylon (BoC) is Sri Lanka's number one financial institution. This disclosure comes from no less person than Bank of Ceylon, Chairman Udayasri Kariyawasam. The following are some of the reasons given by the Chairman for this prime placement of BoC.

* The BoC is the locally operational bank with the largest number of branches - 305 local and three foreign ones.

* BoC has the largest online working network among banks.

* It has the largest number of customer accounts - 5.8 million.

* It is the market leader in foreign currency remittances - 67 percent of the market.

* BoC has an asset base of 326 billion, the largest among banks.

* The bank is engaged in a big way in corporate and offshore banking.

When asked by the Daily News in an interview to briefly outline the main ways in which BoC contributes towards national development, Kariyawasam indicated that this was a near impossible task, for the BoC's contribution is enormous and vibrant.

For example, rather than being dependent on the Government for funds, BoC provides the Government with funds. Besides paying annual dividends and a huge tax revenue to the Government, BoC is a major debt supplier to the State.

Letters of Credit for Government imports are supplied by BoC.

Recently, BoC supplied the State one billion rupees for paddy purchases.

A prominent feature of BoC operations is the vibrant role it plays in the economic life of the people. For instance, through its large branch network, it plays a principal role in cultivating the banking habit among the people.

BoC's vital presence is felt even in the North-East. In the North, it has 13 branches in 'cleared areas' and three in 'uncleared areas' - Kilinochchi, Mankulam and Mullaitivu.

What is particularly noteworthy about these latter branches is that their operations are not disrupted by the LTTE. This is because of their substantial role in the Northern economy.

The BoC operates 17 branches in the Eastern Province; seven of these are online. Of the branches in the North, five are online. In all, 240 of the bank's branches are online. It has 47 extension offices which are also online.

BoC's special closeness to the 'Small man and woman' of Sri Lanka is seen in the major role it plays in the principal development projects under the Mahinda Chinthana programme. For example, it helps in making the 350 factories programme a reality, through the 'Gamata Naya' project.

A fact which is perhaps not very well known is that small and medium scale industries contribute around 50 percent of the national income. The BoC's 'Sukshma' loan scheme is geared to supporting this vital sector of the economy, which has already been identified by the State as an area needing continuous sustenance and support.

Small and medium scale, family-owned enterprises in the agricultural, livestock, domestic and trading spheres-to name a few - qualify for a loan of upto Rs. 250,000, as start-up costs. The recovery rate of these loans is 100 percent, Kariyawasam said. The aim of this programme is the creation of entrepreneurs, island-wide.

BoC fully realises that it is just not sufficient to provide these small entrepreneurs with only the credit. They also need to be provided with the knowledge and know-how to run those businesses and sustain them.

Towards this awareness raising task, the mass media are effectively used. Many series of programs are conducted on ITN, for instance, to equip the target group of small entrepreneurs with the necessary business skills.

In 'Viyaparika A-Z', for example, a series of 12 weekly 15-minute TV programmes in Sinhala is run to explain almost everything (the A to Z) of importance on launching oneself in self-employment.

'Viyaparika Upades' is a follow-up series of four 15-minute programmes, featuring a panel of experts who will answer questions sent in by those who watched the Viyaparika A-Z, series. 'Viyaparika Diyunuwa' is also a follow-up series of four 15-minute programmes, where people who obtained Sukshma loans share their success stories and the underlying concepts.

Among the innovative products introduced by BoC to make it increasingly competitive is a new housing loan scheme, a personal loan scheme, credit cards and a fuel card for public servants. The 150,000 public servants owning such fuel cards are enabled to buy their fuel at Ceypetco stations, thereby rolling money within Government institutions.

Under the BoC's, "housing loans like no other", loan approval within 10 working days of submission of all necessary documents is guaranteed.

Those availing of loans are granted a maximum repayment period of 25 years, including grace periods. Such loans could be repayed over a period extending upto the 65th year of the borrower or at the time of his retirement, whichever is earlier.

Such innovative products are aimed at keeping BoC's number one status among financial institutions, and ensuring its continued vibrancy, Kariyawasam said.