SME Support

SME support program financed by KfW

The objective of the SME support Programs implemented by GAF is to develop the financial sector and SMEs in Armenia, in particular by providing the necessary funding to the RA commercial banks and universal credit organizations in order to make lending to micro, small and medium size private enterprises efficient and profitable. This is supported by introducing new loan technologies in partner banks and organizing the teaching and training of qualified loan experts.

Since 1999, KfW has allotted the Central Bank a total of EUR 16.8 million in loans under four agreements and a total of EUR 2.2 million in grants under three agreements (GAF-MSME-KfW). The loan agreement was concluded at an annual interest rate of 0.75% with a repayment period of 40 years, including 10 years of grace period.

 SME support program financed by RA Government

Based on the successful experience of the GAF-MSME program, in December 2008 the RA Government allotted GAF an additional AMD 15.2 billion in loans within the framework of the anti-crisis measures, with a view to supporting small and medium private enterprises in the Republic of Armenia (GAF-MSME-Gov). Within the framework of this program, lending is carried out with the technology of GAF-MSME-KfW Program, under the same crediting conditions. Program closed in November 2013.

 Access to Finance for SMEs by the World Bank

Within the framework of the anti-crisis measures in the Republic of Armenia and aiming to foster small and medium entrepreneurship in the RA, an agreement was concluded between the Central Bank of Armenia and the International Bank for Reconstruction and Development (member of World Bank) on February 26, 2009, on providing USD 50 million. The main purpose of the "Access to finance for small and medium enterprises" program (GAF-MSME-WB/AFSME) is to maintain or enlarge the availability of loans to small and medium enterprises, thus fostering their growth. The loan was granted with a term of 26.5 years. Based on the standards set out by the World Bank, 8 partner banks were selected with which respective Master loan agreements were concluded.

 Women’s Entrepreneurship Support Sector Development Program by Asian Development Bank

Within the framework of the ADB “Women Entrepreneurship Support Sector  Development” Program on 25 January 2015 a new loan agreement was signed between the Central Bank of Armenia and Asian Development Bank with total amount of USD 20mio.  The program is aiming to stimulate entrepreneurship development among women via the financial system of Armenia thus increasing the availability of national currency funds for women-owned SMEs. For considering SMEs as women-owned SMEs they should meet at least one of the following criteria: at least 50% of the enterprise should be owned by women or  at least 60% of the executive body should consist of women or at least 50% of the employees should be women.

At least 50% of the Program funds should be disbursed to women-owned SMEs. For the program implementation 5 partner financial institutions have been selected by the Central Bank of Armenia and Asian Development Bank with whom appropriate loan agreements have been concluded. The loan is provided to the Central bank of Armenia for 31.5 years.  

Agriculture and tourism SMEfinance Program by European Investment Bank  

The Program is implemented within the framework of EUR 50 million (USD 62.5 million) loan agreement signed on the 4-th of December 2014 between the European Investment Bank and the Central Bank of Armenia. The objective of the Program is financing the Armenian SMEs operating in the field of agriculture and tourism. The control and management of the Program is implemented by the “German-Armenian Fund” Program Management Unit of the Central Bank. The loans to the PFIs are disbursed in local currency with up to 7.5 years of maturity period and principal repayment in the end of the loan term. The loans that are in line with the Program’s eligibility criteria provided by the PFIs, may be refinanced by GAF not later than after six month of the initial disbursement. The beneficiaries of the Program are the SMEs with less than 250 employees. The loan under the Program should satisfy the following conditions: provided in local currency (AMD), be not greater than equivalent of EUR 1 million and have not more than 7.5 years of maturity and 2 years of grace period. 


Energy Efficiency Programme for MSMEs

The German Development Bank (KfW) has recognised the increasing importance of energy efficiency and the key role it will play in the future of Europe. In 2016 a concessional loan under the umbrella of the German-Armenian Financial Cooperation was launched in order to support energy efficiency investments in Armenian enterprises through the "GAF Energy Efficiency Programme for MSMEs". The aim of this programme is not only to help MSMEs reduce their energy consumption and CO2 emissions, but also to support them in increasing their competitiveness.