Less than a month has passed since the signing of a cooperation agreement between OJSC “Guarantee Fund” and OJSC “Keremet Bank”, and we can already witness the results. On September 21, 2020, OJSC “Guarantee Fund” issued the first two guarantees to ensure that individual entrepreneurs receive large loan amounts to replenish working capital.
The entrepreneur, who has received the support from OJSC “Guarantee Fund”, has been engaged in wholesale and retail sales of household goods and tableware for almost ten years.
To date, within the framework of cooperation between OJSC “Guarantee Fund” and OJSC “Keremet Bank”, two more projects have been approved, a number of guarantee applications are under consideration.
Let us remind you that OJSC “Keremet Bank” became the thirteenth partner bank of OJSC “Guarantee Fund” in providing support to SMEs.
On September 17, 2020, within the framework of the implementation of the program “Increasing access for SMEs to financing in order to mitigate the consequences of the coronavirus infection COVID-19”, the Guarantee Fund held a deposit auction.
The auction was attended by six partner banks that entered into an agreement with the OJSC “Guarantee Fund” within the framework of the above program.
According to the results of the deposit auction, the placement volume amounted to 300 million KGS, the average rate to the ultimate beneficiaries is 10% per annum.
Three years ago, on August 10, 2017, an agreement was signed between the Kyrgyz Republic and the International Development Association (the World Bank) on financing the Comprehensive Dairy Sector Productivity Improvement Project. The agreement was ratified by the Law of the Kyrgyz Republic of December 28, 2017 No. 220 and entered into force on April 10, 2018.
In 2018, an agreement was reached between the Guarantee Fund and the World Bank on the Fund’s participation in the implementation of this project. In 2019, the participation of the Guarantee Fund was officially determined by the Order of the Government of the Kyrgyz Republic, which was a confirmation of the competence of the Guarantee Fund, recognition of the effectiveness of its activities by the government bodies and international financial organizations.
To date, the implementation of the Comprehensive Dairy Sector Productivity Improvement Project aimed at increasing the productivity of dairy cattle and the quality of milk on small pilot dairy farms in the Issyk-Kul region is in full progress.
1,307 farms representing four districts of the Issyk-Kul region received loans on an interest-free basis. The first borrowers under this project were farmers of the Jeti-Oguz district in 2019. At present, farmers of Ak-Suu, Ton and Tyup districts of the Issyk-Kul regions have received similar loans for a period of 10 to 36 months.
In total, in 2019, 444 farmers benefited from the support of the Guarantee Fund within the framework of the above project, who were provided with loans in the amount of more than 31.5 million KGS. And in 2020, until today, the number of borrowers within the framework of this project amounted to 864 farmers, who received loans amounting to almost 56 million KGS.
Thus, a comparative statistical analysis of indicators for two years of the project’s implementation showed that this product is in rather high demand among entrepreneurs in the agricultural sector. The increase in the number of borrowers was over 190%, and the volume of loans issued – 180%.
The project will be completed on December 31, 2020, after which the Guarantee Fund intends to reach about 2 thousand direct beneficiaries, transfer funds from the working capital to be able to continue supporting the dairy sector and implement this experience in other regions of the republic.
OJSC “Guarantee Fund” continues to support entrepreneurs of the country in the development of various industries. In addition to performing its main functions – providing guarantees for obtaining loans by SMEs, the OJSC “Guarantee Fund” helps to draw up business plans, projects for entrepreneurs, advises them, conducts thematic seminars and provides all kinds of other assistance within its competence.
So, from September 14 to September 16, 2020, the head of the regional development department of the OJSC “Guarantee Fund” K. Aaliev made a working trip to the Issyk-Kul region. The trip covered the cities such as Karakol, Cholpon-Ata, Balykchy, as well as Jeti-Oguz, Issyk-Kul and Ton regions.
With the assistance of the Plenipotentiary Representation of the Government of the Kyrgyz Republic in the Issyk Kul region, district administrations of the Jeti-Oguz and Ton districts, seminars were organized and held for entrepreneurs and farmers on the topics: “Mechanisms for issuing guarantees”, “Increasing access for SMEs to financing in order to mitigate the consequences of the coronavirus infection COVID-19 ”, information was provided on the cluster projects “Intensive Sheep Breeding” and “Financing the Dairy Sector in the Issyk-Kul Region”. And also answers were provided to questions of interest to entrepreneurs and some participants were provided with consultations.
Representatives of SMEs of the country can always count on the support of their ideas, projects and initiatives from the Guarantee Fund, which is currently operating in all regions of the country.
OJSC “Guarantee Fund” informs that on September 17, 2020, a deposit auction will be held as part of the implementation of the program “Increasing access for SMEs to financing in order to mitigate the consequences of coronavirus infection COVID-19”, with the following parameters:
Auction method: Multiple bid method.
Auction date: September 17, 2020.
Auction code: AD 2001.
The volume of deposit resources: 1,000,000,000 (One billion) KGS.
The maximum nominal loan interest rate for the ultimate beneficiary: 10% (Ten) percent per annum.
Minimum volume of one application: 20,000,000 (twenty million) KGS.
Maximum volume of one application: 300,000,000 (Three hundred million) KGS.
The limit for placing funds in one commercial bank, taking into account previously opened deposits: 640,000,000 (Six hundred and forty million) KGS.
Additional information on holding a deposit auction is published on the official website of the Guarantee Fund www.gf.kg (Loan Organizations/Deposit Auction).