EDB Adopted Small and Medium Size Business Support Programme

Almaty, 24 June 2010. The Eurasian Development Bank approved the Programme of Supporting the Development of Small and Medium Size Businesses by Providing Target Credit Facilities to Financial Institutions.

The purpose of this Programme is to create favourable conditions for the development of small and medium size businesses (SMSB) in the Bank’s member states and enhancing their ability to compete on domestic and external markets. Thus the Programme will address the issues of improving the fixed assets of SMSB; creating new jobs; increasing tax revenue; boosting internal trade, mutual investments and commodity turnover between the Bank’s member states; and saturating the internal market with products and services.

The Programme is open to financial institutions from the member states which meet the standards and qualification requirements set by the Bank.

For each institution that meets the above criteria the Bank will open a credit facility for a term of 3 to 5 years for the purposes of financing SMSB projects. The loan size will be determined individually depending on a per-borrower limit.

The borrowers (financial institutions) will select SMSB projects for financing in accordance with the criteria of the Programme and submit information to the Bank. The Bank will check the projects so selected for compliance with the Programme’s requirements and approve them. Sub-loans can be provided to SMSB for a term of 6 months to 5 years for:

• purchase or modernisation of fixed assets;
• expansion or diversification of business;
• introduction of new technology;
• development of innovative activities;
• production of export or import substitution goods;
• production of competitive, high-value added goods in non-raw-material sectors;
• expansion of mutual trade and investments by market players from the member states by increasing export of equipment, raw materials, components or other goods and services; or
• replenishment of working capital.

Bearing in mind that the Bank is active in five countries with different levels of economic development, a special definition of SMSB was adopted in order to make the Programme universal for all these economies.