EBRD Partners with Bank Eskhata to Bolster Tajik Businesses with $5 Million Loans

EBRD Partners with Bank Eskhata to Bolster Tajik Businesses with $5 Million Loans

(IN BRIEF) The European Bank for Reconstruction and Development (EBRD) is collaborating with Tajikistan’s largest private lender, Bank Eskhata, to enhance the sustainability of Tajik businesses. Under their risk-sharing agreement, EBRD will share half the risk on two loans totaling up to $5 million. A $3 million loan will support Volna Group, a leading retailer of consumer electronics and appliances, in meeting its working capital needs and expanding its retail chain in Tajikistan. Meanwhile, a $2 million loan will aid Tiglat, a wholesaler of paints and construction materials, in constructing a new paint manufacturing facility and procuring energy-efficient equipment. These initiatives aim to bolster local businesses and promote sustainability in Tajikistan, with EBRD’s Small Business Initiative facilitating access to finance and business advice for SMEs and local firms.

(PRESS RELEASE) LONDON, 29-Dec-2023 — /EuropaWire/ — The European Bank for Reconstruction and Development (EBRD) is contributing to greater sustainability of Tajik business by supporting lending activity of Tajikistan’s largest private lender Bank Eskhata.

The EBRD will share half of the risk on two loans collectively worth up to US$5 million under the risk sharing agreement between the two banks.

A US$ 3 million loan to a leading retailer of consumer electronics, home appliances, and white goods, Volna Group, will finance its working capital needs. The funds will also help expand its retail chain currently consisting of 10 stores across Tajikistan.

A US$ 2 million loan will support the investment programme of Tiglat, a wholesaler of paints, varnishes and construction materials. The loan will help construct and operate a new paint manufacturing facility and provide a much-needed working capital. Tiglat is planning to procure energy efficient manufacturing equipment, which will make the production more sustainable and will allow to reduce hazardous emissions.

The EBRD has to date participated in 15 risk sharing transactions in Tajikistan for the amount of almost  US$20 million. Risk sharing facilities are part of the EBRD’s Small Business Initiative, which supports small and medium-sized enterprises (SMEs) and local firms and helps them grow by facilitating access to finance and business advice. By sharing the risk with its partner banks, the EBRD boosts local banks’ ability to lend to SMEs, which often face difficulty accessing tailored finance. The framework also helps participating banks to enhance their risk-taking capacity, receive capital relief and improve their risk management.

In 2023, the EBRD is marking 30 years since Tajikistan joined the Bank. So far, the EBRD has invested more than €908 million through almost 164 projects in the country.

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SOURCE: EBRD