Non-bank financial activities gain luster despite challenges: Egypt

Non-bank financial activities gain luster despite challenges: Egypt

Despite the challenges facing non-bank financial activities, such as high interest rates and the inflationary environment, expectations indicate a bright increase while maintaining the same growth rates during the current year.

Companies operating in the non-banking financial sector rely mainly on borrowing from banks to finance their financial operations, and are affected by the interest rates set by the Central Bank, other than profit margins.

The Monetary Policy Committee of the Central Bank of Egypt decided, last March, to raise the price of the main operation of the central bank by 200 basis points, to reach 18.75%, and it was also decided to raise the credit and discount rate by 2%, to reach 18.75%, after 8 times of raising interest rates throughout 2022.

The experts unanimously agreed that the non-banking financial activities sector is one of the most successful sectors in benefiting from crises and achieving high growth rates, by supporting the diversity of financing alternatives for companies and their ability to achieve their goals, in addition to the sector’s ability to attract more domestic and foreign investments.

Daily News Egypt surveyed experts on expectations of growth rates in all non-banking financial activities.

40% growth in microfinance

Ahmad Al-Khatib, CEO of Abu Dhabi Islamic Bank, said