On 17 May, The European Fund for Southeast Europe (EFSE) provided a loan in local currency equivalent to $10 million to its new partner in Georgia, Credo Bank, for on-lending to rural entrepreneurs. By increasing much-needed access to local currency finance for micro and small enterprises (MSEs), the partners aim to support income generation and business growth, especially during the COVID-19 pandemic.
Credo Bank is a leading provider of tailored business financing for MSEs, including farmers and agricultural producers, across Georgia. The bank’s extensive branch network and strategic focus on this segment makes it an optimal conduit for EFSE to channel impact investments to rural entrepreneurs who may otherwise have difficulty accessing formal banking.
“Micro and small enterprises – particularly farmers – account for two-thirds of employment and income generation in the rural areas of Georgia. Their financial health is thus directly correlated with the robustness of the economy as a whole,” said EFSE Board Chairperson Klaus Müller. “EFSE is pleased to be working together with Credo Bank to ensure that small business owners have access to the resources they need to sustain operations – without the worry of exchange rate risk.”
EFSE’s ability to provide funding to its partners in local currency was boosted by contributions from the European Commission as part of its EU4Business initiative as well as from the German Federal Ministry for Economic Cooperation and Development (BMZ).