The Cabinet has approved the sale of the Government's stake in the SME Development Finance Corporation (SDFC) to the Bank of Maldives (BML).
This strategic decision follows a thorough review of a research paper submitted by the Ministry of Finance and Planning, which outlined the potential benefits of the proposal. BML had expressed interest in acquiring the Government's stake in SDFC, prompting this course of action.
The primary objective of the sale is to ensure uninterrupted lending to small and medium enterprises (SMEs), which remains a key priority of the Government. In its proposal, BML committed to lending MVR 500 million in the first year, with a target of MVR 1.9 billion over the next five years, and an allocation of MVR 300 million to support business start-ups over the next three years.
Following the acquisition, SDFC will operate as an Islamic finance institution in line with Shariah principles and will utilise an advanced digital banking system. BML will retain its current interest rates for small and medium-sized loans, fostering a business-friendly environment that strengthens financial capabilities and operational efficiency.
The transition will enable SME digital financing services to be extended nationwide through BML's extensive network. Under BML, the digitalisation of SDFC's operations will streamline processes, accelerate loan approvals, and enhance overall operational effectiveness under strengthened governance and oversight.