As part of the recently launched “Go Digital” program, ProCredit Bank BiH and the European Bank for Reconstruction and Development (EBRD) signed an agreement in June this year for a 5 million euro credit line, for which the European Union also provided grants. By signing the contract, ProCredit Bank, Bosnia and Herzegovina’s first digital bank, became an EBRD partner in the program’s implementation.
Osman Kajmović, head of ProCredit Bank’s department for business with the economy, discusses the program, who it is intended for, and what the benefits of this credit line are.
ProCredit Bank recently became a partner in the implementation of the first specialized credit line for digitization in BiH as part of the EBRD program “Go Digital.” Who is the program aimed at, and what are the advantages of this credit line?
The “Go Digital” program encourages domestic small and medium-sized enterprises (SMEs) to invest in business digitization in order to improve productivity, operational efficiency, and resilience. Small and medium-sized businesses can now apply for funds to invest in hardware and software for various digital transformation projects such as digital communication, information and IT security, digital management, and digitization of production processes and services through ProCredit Bank. The goal is to encourage SMEs to digitally transform and become more competitive in European Union markets while adhering to the standards required by EU directives.
In addition to loans, small and medium-sized businesses can receive subsidies worth up to 15% of the total loan amount through European Union-financed incentives.
What exactly are digitization and automation, and what are the benefits of incorporating them into SME systems?
Digitization is the use of digital technologies to change the business model, allowing for new revenues and added values. To meet changing business and EU requirements, it develops new or modifies existing business processes, culture, and user experiences.
Many of our country’s small and medium-sized businesses still have a long way to go before they can compete with their counterparts in Western Europe. The goods must be produced in a more cost-effective and efficient manner. Industries are rapidly changing, and previously understood work structures are being redefined. Rapid digitization and digital integration will boost their competitiveness and efficiency, as well as contribute to Bosnia and Herzegovina’s growth.
What types of project investments are eligible for funding through the “Go Digital” program?
Digitization, in particular, encompasses a wide range of technologies and investment solutions. These funds, for example, can be used to fund modern transportation systems, machine automation such as CNC machines or injection machines, cutting machines (laser cutters, plasma, etc.), 3D printers linked to digital development software, automated sorting systems, product packaging and storage, and so on. These are just a few examples, and interested SME representatives can certainly contact us to find out if their digital solutions are suitable for financing through this credit line.
What is the application process, and how do you get the previously mentioned refund of up to 15% of the total loan amount?
The application process for loans and grants to improve the company’s digitization through the “Go Digital” program is straightforward. It is sufficient to submit your investment strategy to ProCredit Bank staff and complete the loan application form. We will evaluate the company’s creditworthiness and forward the investment plan to the Program’s project consultants. A consulting team comprised of international and local experts will review it and, if necessary, assist in optimizing the plan.
ProCredit Bank approves the loan based on the final investment plan, and the full implementation of the project is confirmed by the Program’s verification consultant. Following successful verification, EU grants of up to 15% of the total loan amount will be paid to the company’s account.
ProCredit Bank has been supporting Bosnia and Herzegovina’s economy for 25 years, with a focus on the SME sector. Do you believe our businesses are prepared to fully capitalize on the economy’s digital transformation?
What is critical is that small and medium-sized businesses demonstrate constant agility and the ability to position themselves on local, regional, and European markets. That is why I believe that the “Go Digital” credit line, which includes a grant as part of the credit arrangement, will motivate them to make additional investments in digital transformation, which will work to improve our economy’s most productive and important sector.