The European Bank for Reconstruction and Development (EBRD) and donors are stepping up their support for small and medium-sized enterprises (SMEs) in Serbia by extending new financing to Erste Bank, which will lend the funds to local businesses hurt by the Covid-19 pandemic.
Matteo Colangeli, EBRD Director for the Western Balkans and Head of Serbia, said: “We are pleased to sign this new financing agreement with Erste Bank in support of small businesses in Serbia. Helping local businesses to access finance, which they need to grow and become more competitive, is particularly needed following the slowdown induced by the pandemic and amid ongoing disruptions to global trade. We hope this fresh financing will help many companies to recover from it and boost their business.”
The funds will enable SMEs to invest in better-performing green technologies and to improve their working standards and processes. Such investments are aimed at making local SMEs more compliant with European Union and international standards, thus boosting their competitiveness on both domestic and foreign markets.
SMEs will also benefit from grant incentives of up to 15 per cent of the loan amount. The grants are funded by Luxembourg, Norway and the United States of America via the Small Business Impact Fund, and other donors are expected to participate.
The programme will also aid the expansion of the green economy by promoting investments in energy efficiency improvements. Around 70 per cent of programme funding will be allocated to investments in energy-saving and green technologies, while the remainder will support investments in automation, increased productivity, product quality and safety.
Jasna Terzić, CEO of Erste Bank Serbia, said: “Erste Bank, as one of the leading banks in financing renewable energy sources in Serbia, has been working intensively for many years to create an environment that promotes more efficient management of resources and energy, with the aim of living in a healthier and better environment. Together with our long-standing partner, the EBRD, we will help SMEs to transition to green energy under very favourable credit terms, including the reimbursement of up to 15 per cent of the loan amount. The key to the fight to improve our environment lies in institutions, companies and citizens joining forces, because in order to prevent climate change, we all have to make our contribution.”
Erste Bank is a long-standing partner of the EBRD in SME financing in Serbia. Since 2019, the EBRD has signed four SME credit lines with Erste Bank, worth a total €103.3 million, which have been fully extended to local enterprises. The new SME Reboot loan further extends the cooperation between the EBRD and Erste Bank on assisting SMEs in Serbia.
The EBRD is a leading institutional investor in Serbia. The Bank has invested almost €7.5 billion in the country to date. Its focus in Serbia is on private-sector development, improving public utilities and facilitating the country’s transition to a green economy.