The government has supported a bill aimed at supporting small and medium-sized enterprises (SMEs) of Moldova in the lending process.
The Cabinet issued a positive opinion on the draft amendments to the Law on Small and Medium-Sized Enterprises, which aims to facilitate small businesses' access to loans requested from commercial banks. In particular, it is proposed to introduce the concept of "loan portfolio guarantee", which will provide ODIMM, assuming the credit risk of SMEs to creditors, in accordance with previously established criteria. Thus, the need for individual approval of the guarantee between the bank and the ODIMM will not be necessary. The implementation of this guarantee mechanism offers a number of advantages over individual guarantees, including a simplified application process for a guaranteed loan and reduced processing time; reduced resources on the part of the guarantor and lender to administer the guaranteeing process; increased impact on the economy by facilitating access to financial resources for the business environment and increasing the amount of investment generated in the economy. It is worth noting that over the past year there has been an increased demand for guarantees from SMEs: in 2021 the number of guarantees issued was 5 times higher than in 2020. Currently, the size of the Loan Guarantee Fund is about 600 million lei. To support entrepreneurs, the Ministry of Economy and ODIMM announced the cancellation of the guarantee fee (0.5%) on all guarantee products offered by ODIMM in 2022. As a reminder, the Credit Guarantee Fund is an instrument of entrepreneurial support, created and managed by ODIMM. Its task is to issue financial guarantees for loans requested by SMEs from partner financial institutions (commercial banks). Active guarantee products cover up to 80% of the requested loan amount, while the cost of guarantees varies from 500,000 lei for start-up companies to 7 million lei for exporting companies. One leu (MDL) provided as a financial guarantee facilitates access to 2.6 lei in the form of credit and creates an investment of 3.3 lei in the form of savings. // 10.03.2022 - InfoMarket.
