EBRD, EU and Sparkasse Bank unlock €20 million in financing for small businesses in Bosnia and Herzegovina

• EBRD providing unfunded portfolio guarantee of up to €10 million to Sparkasse Bank, enabling up to €20 million of lending to MSMEs
• Facility backed by EU first-loss guarantee under EFSD+ Growth4All, helping broaden access to finance for underserved businesses
• At least 20 per cent of portfolio supported by EBRD guarantee will be directed to green investments, with at least 50 per cent to benefit inclusive segments, including women- and youth-led businesses and firms outside Sarajevo

The European Bank for Reconstruction and Development (EBRD) and the European Union (EU) are strengthening their support for small businesses in Bosnia and Herzegovina through a new risk-sharing facility with Sparkasse Bank that will help unlock up to €20 million in fresh financing for micro, small and medium-sized enterprises (MSMEs).

The EBRD will provide a €10 million unfunded portfolio guarantee covering 50 per cent of the credit risk on a newly generated portfolio of MSME loans originated by Sparkasse Bank. By sharing the risk, the EBRD and EU will help Sparkasse Bank to strengthen its resilience and expand lending to businesses while optimising the use of its capital.

Backed by technical assistance and a first-loss counter-guarantee from the EU’s European Fund for Sustainable Development Plus (EFSD+) Growth4All programme, the initiative targets underserved businesses – including those led by women and young people – and MSMEs operating in tourism, agriculture and rural areas. The EU backing allows the EBRD to introduce an innovative financial instrument that will help reduce financing constraints for smaller businesses at a time when access to finance remains a key challenge for entrepreneurs.

The facility will support a broad range of MSMEs across Bosnia and Herzegovina, with a focus on businesses owned or led by women and young entrepreneurs, companies operating outside the Sarajevo region, and enterprises active in sectors such as agribusiness and tourism.

In addition, at least 20 per cent of the portfolio guaranteed by the EBRD will finance investments that meet the Bank’s Green Economy Transition criteria, helping businesses improve energy efficiency, adopt renewable energy technologies and enhance their competitiveness through greener operations.

Stela Melnic, EBRD Head of Bosnia and Herzegovina, said: "Small businesses are the backbone of Bosnia and Herzegovina’s economy and a vital source of jobs, innovation and economic opportunity. Through this partnership with Sparkasse Bank and the support of the EU, we are helping more entrepreneurs access the finance they need to grow, invest and become more competitive. We are particularly pleased that the facility will support women- and youth-led businesses, firms outside major urban centres and investments that contribute to a greener economy."

Magdalena Mueller-Uri, Head of Cooperation at the EU Delegation to Bosnia and Herzegovina, said: “EU-backed guarantees are helping expand access to finance for small businesses across Bosnia and Herzegovina. By sharing risk with local banks, the EU is helping entrepreneurs who too often face barriers to credit — including women- and youth-led businesses, firms outside Sarajevo, and companies investing in greener, more competitive operations. This support delivers tangible benefits for final beneficiaries by helping businesses expand and create jobs. This, in turn, helps Bosnia and Herzegovina’s economy to become more resilient and generate sustainable economic growth”

Amir Softić, Chief Executive Officer at Sparkasse Bank, said: “In line with our financial health strategy, our goal is not only to provide financing, but to be a long-term partner to local companies in their development. Our partnership with the EBRD and the support of the EU are particularly important to us, as they enable us to provide even stronger support for the growth and development needs of SMEs. We want to stand by companies as they make important business decisions and lay the foundations for their future growth. Partnerships like this allow us to connect the potential of local entrepreneurs with concrete solutions, helping to build a stronger and more resilient business sector and domestic economy.”

Sparkasse Bank is a universal bank serving corporate, MSME and retail clients in Bosnia and Herzegovina. The bank operates through a nationwide network of 39 branches and outlets and is one of the country’s leading lenders to businesses.

The EBRD is a leading institutional investor in Bosnia and Herzegovina, having invested more than €3.1 billion in the country through 270 projects. The EBRD’s priorities in Bosnia and Herzegovina include supporting private-sector competitiveness, strengthening economic inclusion, accelerating the green transition and improving sustainable infrastructure and connectivity.