EFSE and AraratBank team up to support Armenian MSMEs with a new financing
Luxembourg and Yerevan– The European Fund for Southeast Europe (EFSE) has extended a USD 10 million five-year facility to AraratBank for financing of micro, small and medium businesses (MSMEs) affected by the economic, social, and security challenges triggered by the Russia-Ukraine war, prioritizing those operating in crisis-relevant sectors.
The facility will enable MSMEs to receive continued access to finance, helping them preserve operations and address the rising challenges of strained supply chains and logistics infrastructure .
With this financing, AraratBank will be able to further increase its outreach and scale by issuing over 700 new sub-loans, with longer-term maturities, in support of business and economic resilience in Armenia. This investment will contribute towards SDG 8 (Economic Growth) and SDG 9 (Industry Innovation and infrastructure).
EFSE Board Chairperson Klaus Müller said: “Micro, small and medium-sized businesses are the first to be adversely affected during crises because of the impact on their cash flows and access to critical resources. With this new financing to AraratBank, a longstanding partner of EFSE, Armenian MSMEs will receive much-needed support to continue operating during these challenging times.”
"The years-long cooperation with EFSE reflects an efficient and robust partnership built on mutual trust. Since 2010, a total of 8 projects worth USD 63 million have been funded by EFSE. While citing figures may be truly impressive, it should be also affirmed in words that the partnership with EFSE has greatly fostered micro, small and medium enterprises in Armenia," commented Mher Ananyan, Chairman of the Executive Board of ARARATBANK OJSC.
Araratbank received a multi-currency loan equivalent to USD 10 million from EFSE in 2019, thus contributing to lending in local currency and eliminating exposure to currency risk for beneficiaries of the program.