A new financial instrument will appear in Moldova - a loan portfolio guarantee to facilitate the financing of small and medium-sized businesses.
In particular, this is provided for by the relevant amendments to the Law on Small and Medium Enterprises, which the Parliament adopted in the first reading. According to the draft law, a loan portfolio guarantee is an obligation under which an institution that manages loan guarantee funds assumes the credit risk associated with a portfolio of eligible loans provided in accordance with a cooperation agreement signed with a financial sector entity. The loan portfolio will be guaranteed by the Loan Guarantee Fund administered by the Organization for the Development of Small and Medium Enterprises (ODIMM). The fund will share credit risk by guaranteeing loans received by small and medium-sized enterprises from banks or non-bank credit institutions. According to the authors of the project, a group of deputies from the PAS faction, the implementation of such a guarantee mechanism provides a number of advantages compared to individual guarantees. This will greatly simplify the issuance of loans, eliminate the procedure for the preliminary approval of ODIMM guarantees. Waiting times will be reduced, the use of guarantor resources for guarantee portfolio management will be optimized, and the risk of corruption will be reduced. “The main goal of the bill is to provide wider access to financing for small and medium-sized businesses,” said Dumitru Alaiba, chairman of the commission on economy, budget and finance. In order to determine the need for additional capitalization of the Loan Guarantee Fund, ODIMM, together with a group of international experts, developed financial forecasts in accordance with the priorities of the portfolio guarantee concept. Thus, it is planned to allocate a portfolio of financial guarantees in the amount of 1 billion lei, which can be capitalized by banks for up to 3 years. To ensure the allocation of an appropriate ceiling of financial guarantees, it is necessary to capitalize the Loan Guarantee Fund in the amount of 200 million lei. The bill is to be adopted in the second reading. // 17.03.2022 — InfoMarket
