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Microfinance Products

Micro Insurance

The Bank's pioneering "Microfinance Insurance scheme" was initiated with HNB Assurances PLC, covering both life and liability of loan-takers. Eligibility for the product is open to any micro entrepreneur acquiring credit facilities under the Gami Pubuduwa scheme. A primary element of the venture is that the bank bears half the cost of single premium on the borrower's behalf.

Should the borrower suffer total permanent disability or loss of life, HNB Assurance Limited will settle the outstanding portion of the loan and pay the amount promised to the nominee/bank as life cover.

A significant aspect of the project is that applicants below the age of 55 are not required to undertake medical tests, thus simplifying the process for nearly all applicants to the mere filling of a proposal form. The insurance scheme also facilitates micro entrepreneurs to provide suitable guarantors for their credit facilities.

Microfinance Lending Products

Loan Scheme for Tsunami affected people
The bank, in collaboration with Savings Banks Foundation for International Cooperation, Germany (SBFIC), launched a microfinance program in the Tsunami affected areas in Sept 2005. This scheme provided financial assistance to commence or expand income generating activities in Tsunami affected areas.

Agro Livestock Development Loan scheme
ALDL scheme assists small scale dairy farmers with funds for the construction of cattle sheds, purchase of cows, storage facilities and dairy and agro processing equipment and up to LKR 400,000/- at 8% pa. ALDL scheme also provides financial assistance up to LKR 300 Mn to private sector companies for milk processing plants and the agro processing industry.

Poverty Alleviation Microfinance Project 2
Agriculture, cottage industry, livestock, fisheries, trade and services can be financed up to LKR 200,000/- at 16% pa under this scheme.

Loan Scheme of Awakening North & East
This loan scheme provides financial assistance for the resumption of economic activities and livelihood development in the Northern and Eastern provinces. This refinance loan program was implemented under the HNB microfinance program and is funded by Central Bank of Sri Lanka. Under this scheme, any income generating project in the North and East regions can be financed up to LKR 250,000/- at 12 % pa with a repayment period of 5 years.