Browsing by Author "Liyanage, Chatura"

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Effect of Micro Finance Services on Growth of Micro Small and Medium Scale Enterprises (msmes) in Service Sector Operating in Colombo District
(Faculty of Commerce and Management Studies, University of Kelaniya Sri Lanka, 2023) Liyanage, Sanduni; Liyanage, Chatura
The Micro, Small and Medium Enterprises (MSMEs) has been highlighted as a key strategic sector in Sri Lanka, serving as a catalyst for inclusive economic growth, regional development, job creation, and poverty reduction. Micro-finance is defined as a development tool that provides financial services and products such as very small loans, savings, micro leasing, and money transfer to assist the very poor in expanding or establishing their business. It’s mostly used in emerging economies where SMEs do not have access to other sources of financial assistance (Marguerite, 1998). Through a process of commercialization and privatization, the government has diminished its role as the economy's primary driving force. As a result, the emphasis has changed away from large-scale businesses and toward Micro, Small and Medium Enterprises (MSMEs), which have the ability to build local linkages for quick and long-term economic development. The organized private sector was tasked with spearheading following industrialization efforts. Incentives granted to encourage expanded engagement in various areas were aimed at solving and reducing challenges faced by industrialists in the country, resulting in increased participation in these industries. Incentives were given to encourage increased engagement in these sectors by addressing and reducing challenges faced by industrialists in the country, providing them more discretion in boosting their contribution to the national economy. There is no proper definition for defined MSMEs and different institutions defined in different ways to MSMEs. As defined in most cases, the number of employees and the value of assets are considered. Enterprise size by value of the asset as less than 1 million are micro, assets value between 20-50 million are medium, and more than 50 are large. (A. M.Adam & G.Tweneboah, 2008) And the department of census and statistics identify small industry as employees less than 10 and more than 10 are micro and small in respectively.
Revitalising Export Orientated SMEs of Sri Lanka with Trade Credit Insurance
(2024) Jayaweera, Asha; Bhaumik, Amiya; Liyanage, Chatura
Financial losses due to unsettled receivables from commercial debtors, which expose them to enhanced credit risk, pose a serious challenge to the profitability and expansion of export-orientated small and medium enterprises (SMEs) the world over. Trade credit insurance is a specialised insurance product that aims to mitigate credit risk by protecting the account receivables of businesses involved in international trade. However, the adoption of trade credit insurance amongst export-orientated SMES remains strikingly low. The purpose of this paper was to examine the effectiveness of the use of trade credit insurance in raising the profitability levels of export-orientated SMEs, the reasons for its low adoption rate, and strategies to encourage enhanced utilisation of it among SMEs. The quantitative methodology was employed by way of a survey in conducting this study, which included a sample of 345 managers or owners of export-orientated SMEs in Sri Lanka. Descriptive analysis revealed that 20.9% of the respondents were unaware of the existence and benefits of trade credit insurance, and only 63.2% were utilising trade credit insurance. Ordinal logistic regression analysis revealed that SMEs that employed trade credit insurance in mitigating trade credit risk showed significantly higher growth in profitability in comparison to those who did not. Therefore, to revitalise the export-orientated SMEs and enhance their contribution towards the economic prosperity of the country, it is recommended to increase awareness of trade credit insurance among them and strengthen their risk management culture while improving the service quality of service providers.