By Bojana Vlajcic
The European Bank for Reconstruction and Development (EBRD) is extending a €10 million(US$10.5million) loan to Raiffeisen Leasing Kosovo (RLK), the leading leasing institution in Kosovo.
The financing, backed by the European Union (EU) with grants and technical assistance, will help RLK to offer small solar power generators and electric cars to local entrepreneurs and small and medium-sized enterprises (SMEs) as part of its leasing services.
Part of the package (€3 million) is being extended under the EBRD SME Competitiveness Support Programme, which assists SMEs to achieve compliance with EU standards, particularly regarding the quality of goods and services, environmental protection, and worker health and safety.
Under this programme, SMEs can also obtain technical assistance, including EBRD advisory support. On successful completion of their investment, SMEs will be eligible for a cashback grant of 15 per cent of the total loan amount ‒ both of which will be funded by the EU.
The remaining €7 million will allow RLK to assist more local firms with its leasing services. It will also support smaller enterprises in investing in innovative strategies or products.
EBRD Head of Kosovo, Neil Taylor said: “I am pleased that EBRD funds will support the leasing of electric cars and innovative machinery here, in line with our green strategy and Kosovo’s new draft energy strategy. Leasing can be an attractive alternative to bank lending and we would like to see it being used more in the country.”
EU Ambassador to Kosovo, Tomáš Szunyog said: “Contributing to the development of SMEs in Kosovo, and facilitating their access to financing opportunities and business advice continues to be one of the EU’s priorities in Kosovo. In addition to the €10 million loan provided by the EBRD, the EU will issue more than €500,000 in grants and technical assistance to local entrepreneurs through our joint SME Competitiveness Support Programme. This will help to further strengthen their competitiveness in regional and international markets, and will add to the overall economic development and employment in Kosovo. The EU remains Kosovo’s largest trading partner and the largest provider of financial assistance. From 2007 to 2020, it disbursed €1.21 billion to Kosovo in the EU assistance funds (IPA I and IPA II). In addition, Kosovo benefits from substantial regional IPA funding.”
RLK Executive Director, Gjon Gjonlleshaj said: “We are delighted to strengthen the cooperation with the EBRD. The funds provided will be an added value for our clients in Kosovo, who are gradually starting to purchase electric cars and other equipment that meet environmental and sustainable criteria. Besides this initiative, we look forward to working with the EBRD as we are steadily and successfully developing in bringing green financing to our leasing clients for their business development.”
RLK, which became an EBRD client in December 2017, is the leading leasing institution in Kosovo. RLK is owned by Raiffeisen Bank Kosovo, which in turn is a subsidiary of Raiffeisen Bank International. RLK operates as a non-bank financial institution and provides lease financing to micro, small and medium-sized enterprises and private individuals.
Including this financing, the EBRD has invested €627 million in 90 projects in Kosovo since it began operating there in 2012. The Bank’s strategic priorities in the country are to promote the green economy, support the competitive development of the private sector and foster regional integration.
