In 2017, KfW was developing a grant project under “Access to Finance” component of the European Union “Support to the East of Ukraine” Program. The project was supposed to facilitate access to finance for micro, small, and medium-sized businesses (MSME) located in Government Controlled Areas of Donetsk and Luhansk regions.
The project aimed to create an incentive for financial institutions to start/activate credit/leasing operations in the region and to create opportunities for the development of local MSMEs (mainly the agri-sector) through grants and technical assistance.
KfW invited SME Banking Club experts to conduct an analytical study to understand the specifics of the region’s business, financing needs, financial institutions’ activity, and lending development plans.
In November-December 2017, experts conducted an analysis of the business environment: the number of agricultural businesses in the region, sales volumes, financing needs in general and, investment in equipment in particular, interest in technical assistance. The experts also conducted in-depth interviews with banks potentially interested in participating in the program to assess the current loan portfolio in the region, the features of lending procedures, NPL rate, and the existence of branches.
An analytical report and recommendations for KfW were formed based on the data obtained to prepare the project concept.
KfW used report data and recommendations in developing and launching the FinancEast program.
Between July 2019 and December 2020, AFC, in cooperation with the SME Banking Club from Ukraine, assisted Oschadbank in developing the necessary internal capacity and adjusting the processes for the provision of efficient lending services to eligible MSMEs.
Preparation of a development strategy for the SME segment, considering market conditions, its potential, and the bank’s capabilities.
In 2017, commissioned by IFC, SME Banking Club experts carried out a study of the possibility of improving the conditions for lending to agribusiness in Ukraine, based on the experience of countries with a developed agricultural industry: Canada, USA, Australia, France, Germany, and Brazil.