EBRD expands microfinance in Azerbaijan, September 2006EBRD expands microfinance in Azerbaijan, September 2006
27 September, 2006
Loans to CredAgro to benefit rural areas and small businesses
The EBRD is expanding its support for microfinance in Azerbaijan and extending a $1 million loan to the local microfinance institution CredAgro. $250.000 of the $1 million is being funded by TaiwanICDF. The loan is provided under the Non-bank Microfinance Institutions Framework for Early Transition Countries launched in 2005.
CredAgro, set up in 2000, is a microfinance institution with a strong focus on agricultural and rural lending.
Although Azerbaijan in recent years has strongly benefited from oil and oil-related business, agriculture remains the countryï¿½s second largest economic sector, contributing 14 per cent to the countryï¿½s GDP and providing employment to 40 per cent of the population.
The EBRD loan is set to facilitate access to finance for this vital sector of the economy as the funds will be on-lent to rural entrepreneurs. This will also allow CredAgro to expand its loan portfolio, product range and regional network. The institutionï¿½s long term aim is the transformation into a bank which will allow it to take deposits.
Chikako Kuno, EBRD Director for Small Business, said the loan will support both the development of micro and small enterprises in Azerbaijan and of the countryï¿½s banking sector. Of particular importance is the extension of financing to rural areas and entrepreneurs which is a key objective of CredAgro and also the EBRD.
The EBRDï¿½s Non-bank Microfinance Institutions Framework for Early Transition Countries aims at strengthening microfinance institutions in the Bankï¿½s eight poorest countries of operations. Loans are provided for on-lending to the smallest borrowers across the ETC countries Armenia, Azerbaijan, Georgia, the Kyrgyz Republic, Moldova, Mongolia, Tajikistan and Uzbekistan. The facility is accompanied by a technical cooperation framework funded by donor governments.
Through its micro and small enterprises programmes the EBRD has supported over one million small enterprises throughout eastern Europe, Russia, Central Asia and the Caucasus. The EBRD has worked with 84 commercial banks and non-bank microfinance institutions to establish or expand specialised micro and small business finance units and has lent ï¿½560 million to facilitate close to ï¿½8 billion in loans to micro and small businesses in the region. Press contact:
Axel Reiserer, Tel: +44 20 7338 7753; E-mail: email@example.com