FIF - Bank Eskhata MSME Loan



Project number:


Business sector:

Financial institutions

Notice type:


Environmental category:


Approval date:

19 Oct 2016



PSD disclosed:

24 Jul 2015

Translated version of this PSD: Russian

Project Description

The EBRD is considering to provide Bank Eskhata, a commercial bank established and operating in Tajikistan, a senior loan under the new Tajik Climate Resilience Financing Facility. TajCREFF is a pilot initiative that intends to support private sector investments in technologies which contribute towards development of climate resilience in Tajikistan. The initiative intends to break new ground in the emerging area of financing pro-business climate resilience measures in a country that is highly vulnerable to the impacts of the climate change.

This will be a first loan to a partner financial institution under the TajCREFF (“TajCREFF Loan”). It will allow Bank Eskhata to participate and directly contribute to promotion of investments in technologies and measures which contribute towards development of climate resilience of the businesses and households, in particular investments in improved water and energy use, better land management and irrigation practices in agriculture sector. Bank Eskhata will benefit from dedicated technical assistance provided under the TajCREFF to all participating financial institutions.

The EBRD is also considering a senior loan in Tajik Somoni to Bank Eskhata (MSME Loan) under the Financial Intermediary Framework. The new loan will provide Bank Eskhata with needed medium term funding in local currency, which remains scarce on the market. It will support Bank Eskhata’s efforts in increasing local currency lending to micro, small and medium size enterprises (“MSMEs”).

Transition Impact

The Transition Impact of the TajCREFF Loan is consistent with the transition impact contemplated for Tajik Climate Resilience Finance Facility and is expected to contribute to achievement of the main goal:

  • Demonstration effect of new dedicated financing for climate resilience technologies.  The proposed TajCREFF Loan will assist Bank Eskhata in developing new financing product to support climate resilience investments, with a combined focus on energy, water and land management. It is expected that a number of banks and microfinance organisations will join the TajCREFF following this project. Replicability will be encouraged by building the capacity of Tajik PFIs to identify investment opportunities and promote these technologies through financing in the longer-term, beyond the lifespan of the TajCREFF. The associated policy dialogue, focused on continued support for incremental water and energy pricing reforms and the need to embed climate resilience into energy and water infrastructure planning in Tajikistan will underpin the long-term success of this pilot.
  • Demonstration of new replicable behaviour and activities related to improved use of energy, water and land resources. The loan will facilitate the uptake of improved climate-resilient technologies (mainly based on a LEME list) that are currently either not present or poorly dispersed in Tajikistan. TajCREFF will demonstrate the benefits of improved energy, water and land management technologies to a wide range of beneficiaries, illustrate how such improvements can be economically viable and replicable, and, over time, improve the market penetration of such technologies. The tailored technical assistance to potential suppliers and installers to support the introduction of specific incipient technologies identified in the LEME provided under TajCREFF will contribute to achievement of this Transition Impact.
  • Transfer and dispersion of skills. The TajCREFF loan to Bank Eskhata will allow introduction and scaling up of technical skills on several levels: PFIs, sub-borrowers (private enterprises, farmers, and households) and local technology providers.  At present, the majority of local PFIs are unfamiliar with financing climate resilience investments and lack in-house capacity for appraising such investments. Through TajCREFF, Bank Eskhata will build expertise in assessing the risk of clients for climate resilience investments, while the businesses and technology providers will become more familiar with BE’s requirements for providing finance for climate resilience investments. Dedicated technical assistance will help BE with product design and establishing necessary procedures and structures to deliver finance for climate resilience improvements. It will also assist with business development (marketing and promotion strategies), targeting sectors where commercial financing has been very limited so far and technical and financial audits of investments in climate resilient technologies.

The proposed MSME Loan is in line with the EBRD Country Strategy for Tajikistan and is consistent with the general Financial Sector Strategy of the Bank, which underpins importance of supporting micro, small and medium size enterprises to promote entrepreneurship, innovation and job growth. The Transition Impact for this loan is expected to stem from:

  • Market expansion: the new MSME Loan in Tajik Somoni will allow Bank Eskhata to continue lending to the real economy, including clients in the regions, when demand for loans in foreign currency has receded. MSME’s are deterred to borrow in foreign currency and require loans in Tajik Somoni, which remains scarce. Increased lending in Tajik Somoni will also contribute to lowering of credit risk for MSMEs with limited options to hedge against risks of borrowing in foreign currency.   

The Client

Bank Eskhata is the 5th largest bank in Tajikistan by assets with strong track record of supporting micro, small and medium size enterprises in the country. Bank Eskhata holds leading positions in providing banking services to MSMEs and households across the country, including lending, deposit taking and money remittances. EBRD has been a shareholder of Bank Eskhata since 2006 and has cooperated successfully on number of projects.

EBRD Finance

Under the TajCREFF Loan the EBRD will provide up to USD 3 million in two equal tranches, financed by the EBRD and the Climate Investment Fund, which provided concessional financing for TajCREFF through its Pilot Programme for Climate Resilience.

Under the MSME Loan the EBRD will provide up to USD 7 million in Tajik Somoni in multiple tranches.

Project Cost

USD 10 million in total under two facilities.

Environmental and social categorisation, impact, and mitigation

Categorised FI. Bank Eskhata is an existing client of the Bank and has been satisfactorily implementing EBRD’s environmental and social requirements under existing exposures.

Technical Cooperation

The Facility will be supported by a comprehensive Technical Cooperation programme that will benefit all participating financial institutions and Sub-borrowers. This will be delivered by the Project Consultant team, which will support sub-project origination, preparation, eligibility checking and assessment, capacity building and training support to PFIs. The Project Consultant will be responsible for overall Facility management and implementation as well as performance monitoring. The Project Consultant will also draw from its experience and knowledge gained from implementing the Facility to identify policy dialogue priorities for EBRD to consider in support of Facility objectives. This TC will build on the comprehensive Market Demand Study that was delivered by the Project Consultant during the preparation of the Facility.

The TC is funded by UK DFID Fund (EUR 300,000) and the EBRD ETC Fund (EUR 1.95 million)

Company Contact

Daler Sadykov, (

Bakhtiyor Mansurov,

Business opportunities

For business opportunities or procurement, contact the client company.

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