Yesterday, the CBE has decided to raise mandatory financing to SME to represent 25% of total banks’ lending portfolio instead of 20% previously. The CBE has stated that banks need to comply with at least 10% of total lending portfolio by end of 2021. The decision is aimed to benefit a variety of purposes in a relatively low interest rate environment. While this surely will support banks’ lending growth throughout the coming two years, it should also add fuel to the intensifying competition in such segment, as banks will need to chase a moving target. We also think that the decision will carry great benefits to NBFS vehicles by virtue of more lending potential, as financing to NBFS companies as well as NGOs counts in the nominator of the 25% ratio.