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Russia Small Business Fund
The Russia Small Business Fund has been implemented by the European Bank for Reconstruction and Development (EBRD) with the support of G-7 countries and Switzerland to provide small businesses with finance to fit their particular requirements and to help strengthen the capacity of the Russian banking sector so that it may effectively lend to small businesses. Over 13,000 loans have been disbursed to Russian enterprises and presently almost 1,000 loans are being disbursed monthly.
The Russia Small Business Fund provides micro and small loan financing through a number of Russian banks located throughout the country. Loans are given on a purely commercial basis. Businesses must have adequate financial standing and cash-flow, market demand for their product, and sound management in order to be considered for financing.
Small loans are available in amounts of up to US$ 125,000 with maturities of up to a maximum of three years. Such financing has not been accessible previously for small firms from local banks. The loans are available to companies with typically up to 80 employees involved in production or service industries. Potential borrowers must have sufficient cash-flow from the project to repay the loan and good management skills to obtain credit. Micro credits, of US$ 100 to US$ 30,000 rouble equivalent, are generally for 6-12 months to begin with; as companies build up a credit record, they are allowed subsequent longer and larger loans for all purposes (trade, services and investment). The firm’s debt capacity is analysed before loans are extended. Individual entrepreneurs and firms with typically up to 20 employees may apply for micro-credits.
The programme is being implemented in Moscow, Tula, Nizhny Novgorod, Tomsk, Chelyabinsk, Ekaterinburg, Kemerovo, Moscow, Nizhny Tagil, Novosibirsk, Omsk, St Petersburg, Tver, Yaroslavl, Samara, Togliatti, Vladivostok, Novgorod, Novokuznetsk, Krasnoyarsk and a number of small towns. There are currently 12 local banks and multiple branches which participate. EBRD consultants, Internationale Projekt Consult (IPC) are working in regional banks alongside credit officers to analyse loans and to increase the banks' institutional capabilities.
The Russia Small Business Fund has also invested in Small Enterprise Equity Funds in Nizhny Novgorod and St Petersburg. These funds, which are managed on behalf of the Bank by Small Enterprise Assistance Funds (SEAF), invest a combination of equity and long-term debt in small businesses employing up to 150 people in production or service industries. The maximum investment is US$ 300,000.
Businesses should contact the banks listed below in order to receive application forms if they meet the eligibility criteria mentioned. Alternatively, they may contact the Micro and Small Loans Office for additional information. Applicants should be either existing businesses, or in the case of a new business, entrepreneurs should have some prior experience and at least 30 per cent of the capital required to contribute to the new enterprise.
The main banks participating in the Programme are SBS-Agro, Sberbank, Rossiyskiy Kredit, Inkombank, Mosbusinessbank, NBD, Kuzbassotsbank, Petrovsky Bank, Far East Bank, Toribank, Rosest Bank, Industry and Construction Bank and Uralpromstroibank.
Banks currently participating in the Russia Small Business Fund program
CHELYABINSK KEMEROVO KRASNOYARSK MOSCOW NIZHNIY NOVGOROD NOVOSIBIRSK OMSK ST. PETERSBURG SAMARA TOGLIATTI TOMSK TULA VLADIVOSTOK YEKATERINBURG
