Micro, small and medium-sized enterprises (MSMEs) in Georgia are set to benefit from greater access to finance thanks to joint support by the European Bank for Reconstruction and Development (EBRD) and the European Union (EU).
The EBRD is providing a €10 million loan to ProCredit Bank Georgia for on-lending to local companies, while the EU is complementing this support with grant incentives and free local and international consultancy services, funded under the EU4Business initiative.
The financing will allow local companies to modernise their production by investing in up-to-date technology and machinery, adopting EU standards, enhancing workplace health and safety and fostering sustainable environmental practices. At least 70 per cent of the loans from ProCredit Bank Georgia will finance investments in green technologies.
The funding is part of the EU4Business-EBRD credit line – an instrument that aims to boost the competitiveness of local firms in the Eastern Partnership region. Investments in modern technology and alignment with EU standards will allow companies to strengthen their operations locally and take advantage of international trade opportunities. Since the start of the initiative in 2016, in Georgia alone close to 170 companies have benefited in sectors ranging from manufacturing to agriculture and from hospitality to medical services.
The loan was signed by EBRD Managing Director for Financial Institutions, Francis Malige, General Director, ProCredit Bank, Alex Matua and Director of ProCredit Bank, Zeinab Lomashvili on the sidelines of the EBRD’s 2021 Annual Meeting and Business Forum.
The EBRD is a leading institutional investor in Georgia. Since the start of its operations in the country, the Bank has invested over €4 billion in 262 projects in the financial, corporate, infrastructure and energy sectors, with 79 per cent of these investments in the private sector.
About EU4Business
The EU has been supporting SMEs in Georgia through the EU4Business initiative since 2009. With almost 50 different projects active with a total budget of over €320 million, the EU is the largest foreign supporter of private sector development in Georgia. These efforts are bringing results – in 2019 alone, more than 36,000 SMEs in Georgia were supported, creating an estimated 30,000 new jobs and generating an estimated €400 million of extra income. EU4Business is one of the key tools used by the EU to support economic recovery from the Covid-19 pandemic, with many programmes receiving financial top-ups and having lower eligibility criteria to assist as many SMEs as possible.
About ProCredit Bank Georgia
ProCredit Bank Georgia is the part of the international ProCredit group, which operates mainly in Eastern and South Eastern European countries with transition economies, as well as in Germany. The parent company of the development-oriented ProCredit group is ProCredit Holding AG & Co. KGaA, based in Frankfurt am Main, Germany. ProCredit Bank Georgia has been operating in the Georgian banking sector since 1999. The bank’s main activities are financing small and medium-sized businesses that have a long-term development plan and providing banking services to private individuals who have the capacity to save and prefer doing their banking remotely.
As a development-oriented bank, ProCredit conducts banking operations in a highly responsible manner. This approach entails complying with social, ethical and environmental standards. The bank pays very close attention to the environmental impact of activities and makes every effort to mitigate this impact.
