Under this scheme the target community can borrow loans at the rate of 6.5% Minister of Finance and Mass Media Mangala Samaraweera said.

In the course of fund modernization and expansion of enterprises borrowers can obtain loans even at the rate of 3.3%, the minister told.

Addressing a post budget forum in Colombo the minister said that the cost of capital became one of the biggest barriers today to start a business.

Many young entrepreneurs and SMEs have innovative business ideas but they find it difficult to start operations due to prevailing interest rates of 15% and above, the minister added.