ProCredit Bank has entered into a Guarantee Line Agreement with the United States International Development Finance Corporation and the Swedish International Development Agency to improve access to finance for start-ups and diaspora-related micro, small and medium-sized enterprises (MSMEs) in Bosnia and Herzegovina.
Who is the Guarantee Line intended for?
- The guaranteed line is aimed at all registered private very small, small and medium enterprises in BiH, including their related legal entities, which are owned by a member of the diaspora.
- To companies participating in the USAID BIH Diaspora Marketplace or Swedish Diaspora Challenge Fund: Challenge to Change projects.
- Newly established companies or returnee companies, which have a documented business partnership between the owner of a company residing in BiH and a member of the diaspora residing in another country. The documented business partnership includes:
- Equity participation,
- Trade cooperation,
- Contractual relationship,
- Joint venture or other legal relationship
Eligibility criteria and basic characteristics of the DFC / SIDA Diaspora Guarantee Line:
Available amount: 25,000,000 USD
Program duration: until 30.09.2025.
The following are eligible for funding under the guarantee program:
- A very small enterprise is one that has at least two of the following three characteristics:
- 10 or fewer employees;
- annual income up to the equivalent of $ 100,000;
- and/or total assets up to the equivalent of $ 100,000.
- An SME is one that has at least two of the following three characteristics:
- 300 or fewer employees;
- annual income not exceeding the equivalent of $ 15,000,000;
- and / or total assets not exceeding the equivalent of $ 15,000,000.
Type of loan: Annuity and bullet loans
Maximum loan amount: USD 500.000.00 per client (including related parties)
Loan repayment period: Minimum 6 months, no maximum defined term
Collateral: The guaranteed line can provide 30%, 50% and 70% of the principal of the placement.
Purpose of financing: Investing in fixed or working capital for new investments, it is not possible to refinance the existing debt.
What does the DFC / AIDS Diaspora Warranty Line mean for our clients?
- Easier and more favourable access to finance for small and medium enterprises related to the diaspora,
- Favourable interest rates compared to standard loans,
- Reduced demand for security,
- Increasing production capacity.
This new partnership, which includes the United States International Development Finance Corporation and the Swedish International Development Agency, will help ProCredit Bank provide better services to diaspora-related companies and thus strengthen economic development in BiH and better connect BiH companies with regional and global markets.
For more information on the Diaspora warranty line, contact your Customer Advisor or call us on 033 250 950.