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NEWS: Egyptian Holding Money intends to reduce its targeted financing portfolio in 2024 due to interest rate hike
Safia Mounir
Egyptian Noqood Holding Company intends to reduce the targeted financing volume for medium-sized companies during the current year by about half due to the high cost of financing with the increase in interest rates locally.
Nuqood Group works in providing financial technology solutions for projects and companies in addition to non-banking financial services.
“This year, our target was to reach EGP 400-500 million in the first phase. We will definitely reduce this by no less than 50% in light of the rise in interest rates. We may reach EGP 200-250 million in the first phase,” said Abdel Rahman Ali, CEO of Noqood Holding Group, in press statements at an event in Cairo at the end of the week.
Since the beginning of this year, the Central Bank has raised interest rates by about 8% twice, by increasing 6% in an exceptional meeting in March and before that by 2% in February.
According to the CEO, Noqood Holding will focus in the coming period on selecting clients so that the client is able to pay instead of focusing on increasing the financing portfolio.
Egyptians are suffering from accelerating inflation rates, which reached 35.7% in February, in addition to the decline in purchasing power with the decline of the pound.
Nuqood Holding owns several companies, including Cash Now, which provides daily financial solutions and services to companies, and Nuqood Fintech, which specializes in financial services and investing in emerging companies that rely on financial technology.
Nuqood also owns Nuqood Technology Solutions, which provides technological infrastructure to companies, and Nuqood Electronic Payment Solutions, a digital platform through which companies can complete all their business.
The company is in talks with local government and private banks to obtain financing, but it is not considering resorting to an external financing round at the moment. “It is not our goal this year,” according to Ali.
Abdul Rahman Ali said, "We are talking to 6 or 7 banks. Today we are talking about a financing volume of 250 to 300 million pounds, this is the initial estimate," expecting the deal to be closed by the third quarter of this year.
The company is awaiting the approval of the Financial Regulatory Authority to issue new products, ranging between 8 or 9 financing products, but the CEO did not disclose details about these products, but he expected them to be issued between the third quarter of 2024 and next year.
(Prepared by: Safia Mounir, Edited by: Shaimaa Hefzy, Contact: zawya.arabic@lseg.com)
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