EBRD, EU and Sparkasse Bank finance digital transformation of Bosnian SMEs

• New financing to boost the competitiveness and support the digital transformation of small businesses in Bosnia and Herzegovina
• Fostering SME investments in technology and automation
• EU grants to help make investments more affordable

Small and medium-sized enterprises (SMEs) in Bosnia and Herzegovina will have more opportunities to invest in digital transformation with new financing made available to Sparkasse Bank, provided by the European Bank for Reconstruction and Development (EBRD) and the European Union (EU).

The EBRD has provided an €8 million loan that Sparkasse Bank will on-lend to local SME clients. The proceeds will be used to help small firms invest in the automation and digitalisation of business processes to improve productivity, operational efficiency and resilience.

SMEs will be able to apply for funds to invest in hardware and software for various digital transformation projects in the areas of production, internal processes and services. The aim is to boost the digital transformation of SMEs as well as making them more competitive in EU markets and compliant with the standards required by EU Directives.

In addition to loans, SMEs will benefit from EU-funded grant incentives worth up to 15 per cent of the total loan amount.

Manuela Naessl, EBRD Head of Bosnia and Herzegovina, said: “Digital tools bring many benefits for firms; they reduce costs, facilitate communication, help small firms integrate into global markets, and so on. However, despite the numerous benefits and opportunities that digital technologies bring, many SMEs – and smaller firms, in particular – continue to lag in their adoption. This is why we work together with the EU and our partner banks in Bosnia and Herzegovina to provide well-structured financing and encourage SMEs to invest in digitalisation.”

The credit line is extended under the joint EBRD-EU Go Digital in Bosnia and Herzegovina programme, for which the EBRD has secured €40 million in loans, while the EU has secured grants of €9 million for incentive payments, advisory services and technical assistance.

Amir Softić, President of the Management Board of Sparkasse Bank BiH, expressed his satisfaction with the successful ongoing cooperation with the EBRD and with making another favourable financing model available to the bank’s clients.

“Through the credit line, we realise two strategic goals that are woven into Sparkasse Bank’s business model: to actively strengthen the economy of Bosnia and Herzegovina, primarily by supporting the sustainable development of SMEs, which generate almost 70 per cent of business activity and jobs, and to encourage partnerships on positive solutions for the economic and social development of communities,” Softić commented. “No single institution can make a big difference but, together, several of them can. Such credit lines are an example of how these partnerships can directly benefit the country's economy. Digitialisation can be a powerful driver of sustainable development, both for individual companies and for the country as a whole, because digital solutions ultimately contribute to the preservation of the environment.”

The programme is accompanied by activities from Germany’s Gesellschaft für Internationale Zusammenarbeit (GIZ). GIZ works with the government and stakeholders to help build an enabling environment for digitalisation and innovation in Bosnia and Herzegovina, including digital innovation hubs, in line with EU best practice.

The programme contributes directly to the European Commission’s Digital Agenda for the Western Balkans, which aims to support the transition of the private sector and help businesses fully secure the benefits of digital transformation of the economy.

Since it began operating in Bosnia and Herzegovina in 1996, the EBRD has invested more than €3 billion in 216 projects in the country.