Bank of Maldives (BML) has stated that the acquisition of SME Development Finance Corporation (SDFC) will increase public financial participation and enhance economic self-sufficiency in the Maldives. BML revealed this in a statement issued following the Cabinet’s decision to sell the government’s shares in SDFC to BML. BML said that with this government decision, SDFC will provide Islamic financing services to the country’s micro, small, and medium enterprises (MSMEs) with the most modern technology. The bank noted that under this digital bank’s new strategy, priority will be given to financing start-ups, women-owned businesses, fishermen, farmers, agricultural businesses, sustainable businesses, and e-commerce sectors.
BML said that the purpose of acquiring SDFC is to pave the way for digital transformation of MSME banking in the Maldives by utilizing the bank’s strong financial position, extensive network, and growing digital banking experience. They also highlighted that this decision will increase public financial participation and enhance economic self-sufficiency in the Maldivian economy. BML also noted that in addition to providing financial assistance to MSME sectors and increasing financial literacy, SDFC will offer services with special financial solutions such as digital lending platforms and digital marketplaces.
“The MSME sector served by SDFC plays a crucial role in the Maldives’ economic growth, as well as in economic advancement and innovation. With this bank decision, we will continue to work on providing the most modern banking experience to MSMEs in the Maldives through our digital-first subsidiary, offering Islamic banking services,” said BML’s CEO, Mohamed Shareef.
BML stated that through this digital-first subsidiary, which is set to operate as a BML subsidiary, they will disburse more financing than the total proportion that SDFC has been disbursing. The bank also said that financing will be provided with the favorable terms that SDFC has given to MSMEs. Bank of Maldives aims to disburse MVR 500 million in financing through this subsidiary within the first year. Additionally, to support community development and sustainable business growth, MVR 300 million will be invested over three years through the Maldivian Islamic Social Financing Initiative (MISFI). BML has said that further details regarding SDFC’s operations and governance will be disclosed in the future.
