|
EUR1 million loan to Alter Modus is Bank's first to an NGO
Facility set up with US government will support entrepreneurs in Montenegro
Alter Modus, a non-governmental organisation (NGO) dedicated to providing finance to micro businesses in Montenegro, is receiving a €1 million loan from a facility set up by the EBRD and the US government to help it reach even more entrepreneurs. This is the first loan by the Bank to an NGO.
Alter Modus provides loans to entrepreneurs who would be the least likely candidates to obtain credit from formal lending institutions: refugees, internally displaced persons and other citizens in Montenegro. The average loan size is around €1,500 and can currently rise to €7,500. Projects range from trade to fruit production and plumbing to hairdressing. This loan will enable Alter Modus to reach more clients.
The loan is being provided under the US/EBRD SME Financing Facility, a $150 million fund consisting of $50 million from the US Government and $100 million from the EBRD to support the growth of MSEs in Albania, Bosnia & Herzegovina, Bulgaria, Croatia, Georgia, Kazakhstan, Kosovo, the Kyrgyz Republic, Macedonia, Romania, Serbia & Montenegro, Tajikistan and Ukraine. A portion of the US contribution is also used to provide technical cooperation for institution building and training loan officers.
Elizabeth Wallace, Director for Small Business at the EBRD, said this loan will help overcome one of the main obstacles of successful entrepreneurship: gaining access to finance. Entrepreneurs, who form the building blocks of any successful economy, cannot hope to develop their business without access to capital. The EBRD loan will enable Alter Modus to do just that, Ms Wallace added.
Established in 1999, Alter Modus is licensed and regulated by the Central Bank of Montenegro. The NGO has disbursed close to 7,800 loans worth around €12 million. Around 35 per cent of clients receiving loans are refugees from Bosnia & Herzegovina and Croatia, as well as displaced persons from Kosovo residing in Montenegro.
Luka Djurovic, Credit Programme Manager at Alter Modus, said the NGO is a crucial tool for supporting entrepreneurs across Montenegro. Today, we have 3,000 clients who are creating or expanding their businesses with the help of finance from our institution, and with this EBRD and US loan we will help even more, he added. Alter Modus has a loan portfolio of €3 million, and currently disburses around 350 loans a month. With only 0.7 per cent of loans overdue by more than 30 days, the success of this institution speaks for itself, said Mr. Djurovic.
Dragica Pilipovic, EBRD Director for Serbia and Montenegro, said this loan is in line with the Bank’s strategy to support the development of micro, small and medium-sized businesses in the country. Going forward, the EBRD will aim to help even more entrepreneurs gain access to finance, Ms Pilipovic added. The EBRD is the largest investor in Serbia & Montenegro with more than €500 million invested in 24 projects.
|
