Unfunded guarantee worth €20 million will free up capital for MSME lending
· First unfunded Guarantee for Growth facility signed in Kosovo
· Innovative instrument unlocks new financing for MSMEs across Kosovo
· Twenty per cent of new lending allocated to green financing
In an innovative move, the European Bank for Reconstruction and Development (EBRD) is providing its first Guarantee for Growth (G4G) facility to Raiffeisen Bank in Kosovo, aiming to boost funding for micro, small and medium-sized enterprises (MSMEs).
The EBRD guarantee, worth up to €20 million, will be provided over three years and linked to the bank’s domestic sovereign bonds portfolio. The additional risk-taking capacity freed up by the guarantee will allow Raiffeisen Bank to commit fresh funds to Kosovan businesses, increasing its support to the real economy.
Raiffeisen Bank’s lending under the programme will focus on supporting local MSMEs, which are vital to the sustainable growth of Kosovo’s economy. At least a fifth of the subloans will be dedicated to Green Economy Transition (GET) projects such as energy and resource efficiency.
Sergiy Maslichenko, EBRD Head of Kosovo, said: “The EBRD is committed to further supporting private sector development by financing MSMEs and the green transition through this innovative guarantee instrument.”
Anita Kovacic, Chief Executive Officer of Raiffeisen Bank in Kosovo, added: “As the largest bank in the country, we strongly support the transition towards a greener economy in Kosovo. We are pleased to see that our commitment has been boosted through our signing of this important agreement with the EBRD. We are grateful to the EBRD for this partnership and invite MSMEs to take advantage of this innovative financial instrument.”
Raiffeisen Bank is the largest bank in Kosovo with a lending market share of 20 per cent as at the end of June 2023. It offers a comprehensive range of products to individuals, MSMEs and corporates, with a network of 36 branches and more than 900 employees across Kosovo.
To date, the EBRD has invested more than €650 million in Kosovo, of which 68 per cent has been in the private sector.