The Central Bank issued on August 22nd, 2013 circular #331 in order to develop the Lebanese eco-system and improve the Lebanese knowledge economy through facilitating the financing of start-up companies. The goal of this circular was to support development of entrepreneurial ideas into real time platforms in addition to providing funds. In other words, the circular was able to ease the capital barrier that startups used to face, but there were other barriers that previous governments should have relieved and are mentioned in details thereafter.
The circular stated that banks which invest in a start-up or Venture Capital (VC) will get funding and a loss guarantee up to 75% of the investment while the profits are split in half between the Central Bank and commercial banks. Several amendments were later introduced to make sure that the funds fulfill the spirit and purpose of the circular. In addition, a BCCL circular was issued in order for banks to report and monitor its investments.
As such, BLOM Group has played a significant role in providing capital to funds (and not directly in startups) and was the bank with the highest contribution by committing USD 50.81 Million. Breakdown of participating banks along with their commitments as of September 30th, 2023 will be presented later in the spotlight.
For the full article, click in the link below:
BDL Circular #331 – A Missed Opportunity for Tech Startups in Lebanon