EBRD Secures €8 Million Loan to Empower Women-Led Businesses in Georgia

EBRD Secures €8 Million Loan to Empower Women-Led Businesses in Georgia

(IN BRIEF) The European Bank for Reconstruction and Development (EBRD), with support from the European Union (EU) and Sweden, is extending an €8 million loan to ProCredit Bank in Georgia to boost lending to women-led micro, small, and medium-sized enterprises (MSMEs). This initiative, marking ProCredit Bank’s first foray into gender-focused financing, aligns with the EBRD’s Women in Business (WiB) program, which facilitates women’s access to finance and expertise through advisory services and mentoring. With women-led firms often facing barriers due to their size and collateral limitations, this credit line offers risk-sharing mechanisms to expand access to finance for female entrepreneurs. Under the European Fund for Sustainable Development Plus (EFSD+) guarantee program, this initiative aims to empower MSMEs, enhance competitiveness, and foster sustainable investments in Georgia’s economy, reinforcing ProCredit Bank’s commitment to responsible banking and SME development.

(PRESS RELEASE) LONDON, 13-Mar-2024 — /EuropaWire/ — Women-led micro, small and medium-sized enterprises (MSMEs) in Georgia are to benefit from fresh funds, thanks to a loan by the European Bank for Reconstruction and Development (EBRD), supported by the European Union (EU) and Sweden.

A credit line of €8 million to ProCredit Bank, one of Georgia’s leading banks and a longstanding EBRD partner, will be made available to women-led firms to finance investments to boost growth and development.

This is the first time ProCredit Bank has extended gender-focused financing. It is joining the EBRD’s Women in Business (WiB) programme, which, with the support of the EU and Sweden, enables women’s access to finance and know-how through advisory services, mentoring and training.

The EU is supporting the loan for women entrepreneurs under its European Fund for Sustainable Development Plus (EFSD+) guarantee programme.

Women-led firms are often seen as a riskier segment in the economies where the EBRD invests due to their small size and lack of hard collateral. Under the new credit line, women entrepreneurs will benefit from risk sharing, allowing more women entrepreneurs who would not be able to provide hard collateral to qualify for and secure finance.

The EFSD+ financial inclusion programme is designed to empower MSMEs, fostering their competitiveness and growth. By offering strong financial tools and expertise, the programme aims to encourage intermediaries to direct new lending to those businesses that need it the most. In 2021-27, EFSD+ is channelling €22.5 billion in the form of blending and guarantee instruments to promote sustainable investments in the EU’s Neighbourhood and enlargement countries.

ProCredit Bank in Georgia is part of the international ProCredit group of development-oriented commercial banks in Germany, south-eastern Europe and South America. Frankfurt-based ProCredit Holding owns the group. ProCredit banks promote transparent and inclusive financial sectors. The bank’s business model prioritises developing small and medium-sized enterprises, and its business strategy includes actively supporting sustainability. ProCredit Bank, which has been operating in Georgia for 25 years, upholds European banking standards. Responsible banking practices and financing provided by the bank enable SMEs to scale up, innovate and contribute to creating employment.

To date, the EBRD has invested more than €5 billion in 290 projects in the financial, corporate, infrastructure and energy sectors in Georgia, with 83 per cent of those investments in the private sector.

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SOURCE: EBRD