EBRD provides €5 million financing package to Union Bank in Albania

This article is brought to you in association with EBRD.

• EBRD provides a €5 million financing package to Union Bank under two programmes
• Financing will support young entrepreneurs and digitalisation of small businesses
• Donor support from the EU, Italy, Luxembourg and Sweden

The European Bank for Reconstruction and Development (EBRD) is supporting small businesses in Albania in partnership with Union Bank, the European Union (EU) and other donors.

The Bank is lending €5 million to enhance the digitalisation of small and medium-sized enterprises (SMEs) and improve access to finance for SMEs owned or led by young entrepreneurs, with that support being provided under two different credit lines:

• A €3 million loan is being issued under the EU-supported EBRD Go Digital programme for on‑lending to Albanian SMEs in support of automation, digitalisation and green technology investments. This is the first time that the Bank has extended a loan under that programme in the Western Balkans. The majority of these funds will be used to support automation and digitalisation projects, demonstrating the Bank’s focus on modernising the private sector. At the same time, green investments will also remain a priority in Albania, with at least 60 per cent of this funding going to projects consistent with the Bank’s Green Economy Transition (GET) approach. This programme will also include a comprehensive technical cooperation package, supporting pipeline development, implementation and training, and 10 per cent investment incentives encouraging sub-borrowers to implement automation and digitalisation investments, with both being funded by the EU through the Western Balkans Investment Framework (WBIF).
• €2 million is being lent under the EBRD’s flagship Youth in Business (YiB) programme for SMEs that are owned or led by entrepreneurs under the age of 35 – an underserved segment in Albania. Through this programme, the Bank is empowering young entrepreneurs in Albania, boosting their financial inclusion and offering a product tailored to their needs. In addition to finance, the programme also offers advisory services aimed at building capacity and increasing know-how, helping those young business leaders to fulfil their potential. First Loss Risk Cover (FLRC) of up to 10 per cent of the loan amount will be provided for the benefit of Union Bank, aiding access to finance expansion. FLRC will be supported by the EU through its European Fund for Sustainable Development Plus (EFSD+) programme – the first time that EFSD+ has supported a project in the Western Balkans. The technical cooperation for the YiB programme is also supported by Sweden through the Swedish International Development Cooperation Agency (SIDA), by Italy through the Central European Initiative (CEI), and by Luxembourg through the EBRD’s Small Business Impact Fund (SBIF).

Ekaterina Solovova, the EBRD’s Head of Albania, said: “We are proud to be strengthening our support for small businesses in Albania, a cornerstone of the local economy, through this partnership with Union Bank. This latest financing package reflects the EBRD’s strategic approach to fostering youth empowerment and driving the digital transformation of the private sector in Albania.”

Silvio Gonzato, Head of the EU Delegation in Albania, added: “We are proud to provide funding through the EBRD and Union Bank in order to facilitate access to finance for SMEs in Albania. SMEs employ more than 80 per cent of the workforce in Albania, and such funding is vital to ensure their continued success. We aim to support young entrepreneurs and promote the use of digital technologies in SMEs in order to make them more competitive, which is in line with the EU’s Digital Decade and our Strategy for Youth. This is also what the EU Growth Plan for the Western Balkans aims for.”

Flutura Veipi, the CEO of Union Bank, said: “We are excited to partner with the EBRD in launching these two transformative programmes. We are also proud to build on the success of the YiB programme, where an investment of €1 million has already delivered amazing results in supporting young entrepreneurs and scaling up their businesses. This experience has shown us the potential for growth when we invest in youth, and we are excited to continue expanding these opportunities. These initiatives represent a significant step forward in fostering innovation, economic growth and sustainability in Albania, supporting the next generation of leaders and modernising the private sector.”

Union Bank is a commercial bank in Albania and a longstanding partner of the EBRD, mainly focusing on lending to SMEs.

To date, the EBRD has invested over €2.2 billion in Albania through 159 projects.