Eurocredit is an international model European company, a microfinance organization, and has been operating in Georgia since 2011. It is one of the first to incorporate car loan simplicity, security terms and is now preparing constructive plans for small business development.
Eurocredit's 200-member team of professionals is working today to create an innovative, reliable, and constantly evolving customer and the employee-centered environment by offering the best services in the microfinance sector. The company continued to grow even when a pandemic broke out in the country and small or large businesses were in significant danger. Given the potential dangers, Eurocredit has created a project, "Quick Business Loan", which allows small and medium-sized businesses to get loans easily, very quickly, without additional bureaucracy.
Irakli Tsurtsumia, Operational Director of Eurocredit, provides us with more details on this topic.
What are the challenges that you’re facing and how would you assess the past year?
In 2022, despite several challenges and pandemic conditions, our team was able to achieve quite good results. We highlight the fact that our portfolio has grown by more than 30% over the years. At the same time, our reserves have decreased, which means that in the periods when the portfolio has grown, the existing portfolio has significantly improved, recovered, which is naturally reflected in its quality. This means that to some extent we have shown more professionalism, on the one hand, we offered customers the most tailored terms, which would be largely an individual schedule, refinancing so that in case of delays the users would be able to pay.
In the challenges I mentioned, we stated that we wanted to make a series of moves in the direction of impact, one of such projects is an auto loan. We can say that we were the first to introduce a channel that allows users to get a loan online from home, office, cottage, only through the application. Similar conditions apply to a repayment loan. In case of repayment loan, our customers have the opportunity to get a loan in a few minutes, quietly, without any additional bureaucracy, paperwork, or browsing.
Our next challenge in 2022 is to further simplify the process. The procedures required to visit the branch today need to be fully integrated into the online space. Users will be able to perform all of these operations remotely. Including fast business loans. Our goal is to make the process smooth and transparent for small and medium entrepreneurs
The quick business loan project, that you started during the pandemic, what prompted this decision?
Our new project, Fast Business Loan, has been working in test mode and it aims to make the company significantly more active compared to previous years and we will diversify our portfolio in some way. On the other hand, allow consumers to enjoy not only car loans but also business loans. Business loan when we say we mean, Several purposes, legal entities or individuals engaged in entrepreneurship, who have the status of a small entrepreneur or individual entrepreneur can use our product.
In our case, the target group and segment is small and medium business. We have seen that several destinations such as tourism, restaurants, etc. for obvious reasons have had to at least stop and in some cases even closed businesses because they could not cover running costs which in some cases did not stop. Businesses incurred expenses and income was declining. We declare our readiness to consider similar projects and to give those who had even positive experiences before the pandemic but then reduced or stopped earning an opportunity to continue their business. Nowadays, they need to finance their initial expenses to re-start the business and start operating. We are ready to approve the loan in such cases even without checking the latest income and allow them to work, become a successful business, get a loan and honestly fulfill the terms of the contract.
Our project also includes a development direction. Conditionally the development company failed to complete the project. For example, the building has nine floors provided by the plan, and the company was able to build only 8 floors, they are unable to sell the product because it is distributed in the community under the name of a halted building. In such a case, we are ready to consider similar projects to enable them to be completed. We will consider similar projects and on that schedule, we will lend to the company for whatever period they will need it.
What is the main long-term goal of the project?
Naturally, depending on the conditions of the pandemic, it depends on many circumstances, but our goal is to create a product that will be usable, it will be a product that will help small and medium-sized businesses to grow and expand. We hope that this process will be mutually beneficial in the long run. With this product, we are naturally entering a new market and it is a new challenge for our team, we are confident we will create a product, a portfolio that will be useful for both our company and our customers.
How do you think your project will benefit small business owners?
The first thing we can single out is a specific schedule, grace periods that take into account seasonality, as well as a schedule tailored to certain revenue streams. We also have the opportunity to give even a grace period not for the amount provided in the full schedule but at least for the principal amount, which in the standard case is a monthly payment. This will allow the customer to pay up to twelve months with a grace period and tailor this schedule to their business. Also, our advantage is speed. Lending will be possible within two days of submitting all the necessary documentation to us, which significantly reduces all existing bureaucracies in this market and helps customers to make quick decisions with our help. An easier way to raise money will be added as part of our new project to support small businesses. We will provide loans up to 10 000 GEL without any collateral, this will allow them to establish their own business without collateral and excessive bureaucracy.
What do small business owners need to be able to use your service?
The first is a very interesting part of the opportunity to fund a startup, in this case, the requirements are natural, we need information about the project on what to spend the money we have issued. In the case of a startup, we need to make sure the project is successful, the next part is to provide. Although startups are generally a high-risk area for several financial institutions. We decided to actively enable them to give good ideas and projects a better chance of getting paid. I will specify here that in the case of both startups and other areas, the main part of loans and credits will be secured by real estate. Given the high risks, we want this provision to increase the responsiveness of our customers.
In addition to startup loans for different purposes, such as working capital, as well as necessities that a small business owner may have. Naturally, short-term loans for current expenses are meant here. For example, with the help of loans up to 10,000 GEL, we have the opportunity to issue short-term loans so that businesses can overcome the short-term cash deficit.
How important is a credit history for you?
Credit history, which is often crucial, is reviewable and solvable with us It doesn’t mean that it is insignificant to us. It just means that if customers had some payment deficiencies in the past but now these deficiencies are rectified, we will consider financing it. There may be a current issue caused by incorrect planning or scheduling, in which case we are prepared to take an individual approach to lend. If a customer has a bad history but it is corrected, at this point for us this fact is no longer crucial and for us, bad history of the past does not mean automatic denial.
There is a Quite strong competition in a similar direction in the market and what would you say to the people who will face this important decision. Why Eurocredit?
Our team believes that competition develops the company, the product and helps to create the product that is most acceptable to the customer. So the more different products, offers, ideas there will be in the market the better service we will offer to our customers. In our case, we can distinguish between agility and flexibility.
