The German Government provides UAH 100 mln in loans to SMEs
October 12, 2017.
On October 11, 2017, the German-Ukrainian Fund (GUF) and KredoBank signed an agreement on providing UAH 100 mln in loans to Ukrainian small and medium-sized enterprises (SMEs). According to it, KredoBank will provide crediting on special terms — 15% per annum in hryvnias. The deal is a part of the SME Promotion Program funded by the German Government through the German State Development Bank KFW and is supported by the EU4Business initiative.
"The German government started supporting the German-Ukrainian Fund in 1996. Since then, Ukrainian business has received numerous opportunities through this cooperation, one of which has been the SMEs Promotion Program. KredoBank's accession to the program will extend the access of Ukrainian entrepreneurs to loans in national currency on favorable terms," Sebastian Knocke, First Secretary of the German Embassy, Department of Economic Cooperation and Development, said at the press conference.
The priority SMEs activities for crediting are agriculture, forestry and fisheries, processing industry, temporary placement and organization of food, electricity, gas, steam and air conditioning supply. However, funds will be provided for purchase or upgrading of equipment, purchase, construction or reconstruction of premises or replenishment of working capital to boost production.
"The agreement with the German-Ukrainian Fund provides us with new, convenient and accessible tools for expanding our work with SMEs. Support for these categories of business in the priority areas, firstly, will facilitate their activities on the market, and, secondly, will activate and strengthen the economy of Ukraine as a whole," Damian Ragan, First Deputy Chairman of the Management Board of KredoBank, stressed.
Oleg Strynzha, executive director of GUF, noted that the fund is going to improve the SME crediting mechanism: "Our main goal for the near future is to join forces with as many partner banks as possible. Also, in the framework of the GUF development strategy till 2020, we plan to improve the SME lending mechanism through completing it with credit guarantees within the framework of the National Bank of Ukraine's restart lending project and interest rate compensation from local administrations.”
"Apart from practical advise on how to access EU's Single Market and present/market your products in the best possible manner, one of the main goals of the EU4Business initiative in Ukraine is to improve SMEs' access to affordable long-term financing in local currency. We are pleased to team up with KfW in doing this, so that the Ukrainian SMEs can benefit from such financing", - Mr Jocelyn Guitton, Acting Head of Trade Section of the EU Delegation to Ukraine, noted.
Under the SME Promotion Program the German State Development Bank KFW pledged to provide Ukrainian SMEs with UAH 300 mln over the next 40 years. ProCredit Bank was the first bank to join the program on September 5, 2017.