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EBRD promotes microfinance in Kosovo
€4 million loan to support local entrepreneurs
The EBRD is extending its second loan to a non-governmental organization (NGO) in Kosovo to help local entrepreneurs gain more access to finance to build new or expand existing businesses.
The €4 million loan will enable the Kosovo Enterprise Programme (KEP) to on-lend finance to micro, small and medium-sized enterprises (MSMEs). The loan falls under the €75 Million EBRD Micro, Small and Medium-Sized Enterprises Finance Framework for the Western Balkans and Croatia, which aims at facilitating access to finance for smaller business clients.
Established in 1999 by the International Catholic Migration Commission, a Geneva-based NGO, to provide financing and consultancy to entrepreneurs in Kosovo, KEP is today the leading and largest microfinance institution with Kosovo-wide branch coverage.
This loan will be complemented with a technical assistance programme funded by the US/EBRD SME Financing Facility. This package will assist KEP in its transformation into a shareholding company as a step to become a full commercial bank in 2008.
The Bank signed its first €3 million loan with KEP in December 2006. Since then, KEP has on-lent 1,000 loans per month to local entrepreneurs.
Chikako Kuno, EBRD’s Director for the Group for Small Business, said the Bank’s second loan to a local NGO is an important vehicle that will help finance even more entrepreneurs in Kosovo. The Bank’s loan is helping to fuel competition among the many institutions supporting local micro and small businesses, which will ultimately benefit the entrepreneurs, said Chikako Kuno.
Muriithi Kagai, KEP Executive Director, said the EBRD and KEP partnership will develop further in the future as KEP's plan to become a commercial bank progresses. This investment highlights the confidence a respected institution like the EBRD has in KEP, and should encourage other institutions that are keen to form a partnership with KEP in the future.
The EBRD was one of the first International Financial Institutions to begin operating in Kosovo in 1999 and across its countries of operations, the EBRD has committed over €947 million to 122 financial institutions to support more than 3 million small and micro enterprises.
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