Program “Increasing access for SMEs to financing in order to mitigate consequences of COVID-19”

Within the framework of the Action Plan of the Government of the Kyrgyz Republic for 2020 to restore economic activity and support activities of business entities (Action Plan of the Government of the Kyrgyz Republic), at the initial stage, a Program “Financing of Entrepreneurship Entities” was developed, which provides for total funding of 14 billion KGS.

To support SMEs and expand provision of guarantees and ensure access for SMEs to loan and other financial resources, the National Bank of the Kyrgyz Republic (hereinafter – the National Bank) allocated 1.0 billion KGS to the equity of the Guarantee Fund.

The financing received will be the source for the implementation of the Program of concessional lending through commercial banks with the participation of the Guarantee Fund.

OJSC “Guarantee Fund” (hereinafter – OJSC “GF”) in order to provide support, provide access to preferential financial resources, increase provision of guarantees to entrepreneurs and create additional monetary resources for banks, has developed a Program “Increasing access for SMEs to financing in order to mitigate consequences of COVID-19” (hereinafter – Program) which provides:

  • support and financing to SMEs by providing access to concessional financial resources (loans);
  • mitigation of the consequences of the spread of coronavirus disease COVID-19 and preservation of sustainable business relations between SMEs.
  • stimulation of partner banks to increase the concessional lending to businesses.

The implementation of the Program is aimed at achieving the following results in the short term:

  • retention of business activity of SMEs in the country;
  • access for SMEs to concessional lending;
  • organization, together with partner banks, of affordable financing during the crisis;
  • reduction of negative impact of COVID-19 on the country’s economy, preserving previously created jobs by SMEs and creating conditions for opening new jobs.


To achieve this goal in the Action Plan of the Government of the Kyrgyz Republic, the National Bank in June 2020 increased the authorized capital of OJSC “GF” by 1.0 billion KGS in order to support entrepreneurship entities and facilitate the further development of their activities by increasing access to financial resources in order to mitigate the negative effects of the COVID-19 pandemic.

To ensure equality among partner banks of OJSC “GF” and transparency of placing funds at low interest rates, with the aim of further implementation of concessional financing within the framework the Program, OJSC “GF” will announce an auction among partner banks for placing funds of OJSC “GF” in partner banks for further lending to SMEs. The auction will be held by the method of considering the applications of the Banks with the lowest interest rate.

In accordance with the Decree of the President of the Kyrgyz Republic S. Sh. Jeenbekov dated January 8, 2020, “On declaring 2020 as the Year of Regional Development, Digitalization of the Country and Support for Children”, the main emphasis is given to the development of regions, placement of 1.0 billion KGS in the form of guarantees is planned in the regions of the country excluding Bishkek.

The resources provided by OJSC “GF” for further co-financing of SMEs have a specific purpose and must be provided by the bank for the acting entrepreneurs of the country’s regions in the following areas.

Target areas of financing:

  • production and processing of agricultural products;
  • manufacturing;
  • tourism;
  • transport;
  • export-oriented and import-substituting enterprises;
  • trade and logistics centers and vegetable stores;
  • innovative activity (creation of new enterprises or new directions of activity);
  • production of protective medical equipment and personal protective equipment.
  • education;
  • information technology;
  • cluster projects of domestic producers, including development of intensive sheep breeding.

Loan term: 60 months.

The maximum maximum interest rate for lending to SMEs is 10.0% per annum.

Based on the results of the program implementation, OJSC “Guarantee Fund” expects:

  1. Increase in the amount of guarantees issued by OJSC “GF” up to 1.0 billion KGS;
  2. Issuance of concessional loans secured by guarantees of OJSC “GF” up to 2.0 billion KGS, depending on the share of guarantees in the loans issued;
  3. Involvement of more than 1,000 SMEs during the implementation of the Program;
  4. Creation of new jobs;

Retention of existing jobs.