SME Support
All SME Programs implemented by GAF comply with GAF's
environmental review guidelines for SME finance projects.
SME support program financed by KfW
The Support to Small and Medium Enterprises (GAF-MSME) Loan Program is one of GAF’s longest-running financing programs. Established within the framework of German-Armenian Financial Cooperation, it aims to strengthen Armenia’s financial sector by providing partner financial institutions with long-term resources for SME lending, introducing modern lending technologies and supporting the professional development of credit officers.
The first phase originated from the 1998 financial cooperation agreement between the Federal Republic of Germany and the Republic of Armenia. KfW provided the Central Bank of Armenia (CBA) with a EUR 16.8 million funds. The Program also introduced an SME lending approach based on business analysis rather than primarily on collateral, contributing to the development of business lending practices in Armenia.
In response to the economic effects of the COVID-19 pandemic, the CBA and KfW launched Phase II in February 2021 with EUR 25 million. Phase III followed in December 2021 with EUR 70 million and continued the objectives and approach of Phase II. Technical assistance has accompanied the Program, supporting partner financial institutions in lending methodology and capacity development.
By 31 December 2025, 24 partner financial institutions participated in GAF-MSME, including 14 commercial banks and 10 credit organizations. Since inception, approximately 95,026 loans totaling AMD 502.3 billion had been provided.
|
Access to the Program |
Access to Finance for SMEs by the World Bank
The Access to Finance for Small and Medium Enterprises (GAF-AFSME) Loan Program was established with World Bank financing to maintain sufficient local-currency funding for Armenian SMEs and mitigate the adverse effects of the 2008–2009 global financial crisis.
The Program was launched on 26 February 2009 through a USD 50 million loan to the Central Bank of Armenia with a maturity of 26.5 years. Under the Program, resources are provided to partner financial institutions on a refinancing basis, with a five-year repayment term. By 2012, the funds designated for the Program had been fully received from the World Bank and distributed by partner financial institutions to SMEs.
Although the original World Bank resources were fully utilized, financing activity continued through the Program revolving mechanism. By the end of 2025, nearly 29,672 loans totaling AMD 164.0 billion had been provided to SMEs by partner financial institutions and refinanced by GAF.
|
Access to the Program |
Women’s SME Support Program by Asian Development Bank
The Women’s Entrepreneurship Support Sector Development (GAF-WSME) Loan Program was launched through cooperation between GAF, the Central Bank of Armenia and the Asian Development Bank (ADB) to promote women’s entrepreneurship and improve access to finance for women-led and women-focused small and medium-sized enterprises in Armenia.
The loan agreement was signed on 25 January 2013 for an amount equivalent to SDR 13.035 million. Under the Program requirements, at least 50% of sub-loans were to be disbursed to “Women SMEs”. Eligible Women SMEs included enterprises where women owned at least 50%, women represented at least 60% of senior management, or women accounted for at least 50% of registered employees.
In addition to long-term financing for partner financial institutions, ADB provided technical assistance to GAF and participating institutions in areas including environmental, healthcare and social management, procurement and reporting.
ADB formally closed the Program on 31 December 2017 in accordance with the loan agreement. During implementation, nearly USD 17.5 million was received from ADB and disbursed to partner financial institutions. Financing nevertheless continued after the original resources were utilized through a special revolving fund accumulated from repayments.
As of 2025, seven partner financial institutions participated in the Program, including five commercial banks and two credit organizations. As of 31 December 2025, the outstanding portfolio comprised 993 loans totaling AMD 8.2 billion (USD 21.6 million).
The Program continues to provide a dedicated financing channel supporting women’s participation in entrepreneurship through the revolving-fund mechanism.
|
Access to the Program |
Private Sector Facility / Armenia Economic Resilience Program by EIB
Cooperation between GAF, the Central Bank of Armenia and the European Investment Bank (EIB) under the Private Sector Facility began in 2014. The Program has evolved through successive phases from financing SMEs and mid-cap enterprises in agriculture and tourism to a broader economic-resilience facility supporting production, green investments, women’s economic empowerment, regional development and other priority areas.
Phase I was established through a EUR 50 million agreement signed in December 2014, with at least 70% of resources intended for SMEs and up to 30% for mid-cap enterprises. Phase II, also EUR 50 million, was signed in November 2016 and maintained the focus on agriculture and tourism. Phase III was signed in October 2018 with EUR 50 million and broadened eligibility to include the production sector and support for exports.
In December 2022, a EUR 70 million agreement launched Phase IV, the Armenia Economic Resilience Program. It finances projects in agriculture, tourism and production, with targeted directions for energy-efficient investments, women’s empowerment and regional development, while piloting digitalization and automation. Agreements were signed with 13 partner financial institutions.
Phase IV successfully exceeded its key allocation targets: 69% of funds were directed to regional development against a 45% target; 42% to green investments against a 40% target; and 32% to women’s empowerment components against a 30% target. Overall, 87% of Phase IV funds were directed to SME projects.
As of 31 December 2025, the outstanding portfolio comprised 1,134 loans totaling AMD 61.1 billion (EUR 136.1 million).
Building on these results, a new EUR 100 million agreement—Armenia Economic Resilience Facility II—was signed in October 2025. Its scope is similar to Phase IV, focusing on energy-efficient investments, women’s empowerment and regional development in tourism, production and agriculture.
|
Access to the Program |
Armenia Economic Resilience Facility II Program by EIB
Through an agreement with the European Investment Bank (EIB; www.eib.org) we are supporting small and medium sized businesses (SMEs) and enterprises having less than 3 000 employees (MidCaps) by providing access to an invaluable source of lower cost finance and flexible repayment schedules.
A European Cooperation for the benefit of SMEs
The EIB is the long-term lending bank of the European Union; its role is to finance investment projects in support of EU policy objectives. With a view to supporting EU external action, by decision of the European Parliament and of the Council, the EIB is granted an External Mandate to finance corresponding projects outside the EU.
Thanks to its best possible rating on the capital markets (AAA), the EIB can borrow funds on favourable terms, which it passes on to SMEs and MidCaps through us. The SMEs and MidCaps are specifically and individually informed by us of the EIB’s involvement and its impact on the financial terms of the loan received. Extensive information related to the EIB Group support to SMEs and MidCaps can be found on the EIB website (www.eib.org).
What is EIB funding?
The EIB is strengthening its support for SMEs and MidCaps by helping this important sector to access vital new lines of credit. The loan term is of a minimum of 2 years (the actual length of the loan will depend on the economic and technical life of the project financed) and it can be used to finance from very small projects to investments with a maximum cost of EUR 25 million. The EIB’s contribution, however, cannot exceed EUR 12.5 million.
Who can apply for an EIB loan?
Local SMEs with less than 250 employees on a consolidated basis prior to the investment;
Local MidCaps with less than 3 000 employees on a consolidated basis prior to the investment;
Most economic sectors are eligible with a few exceptions, amongst which production of weapons and ammunition, arms, military or police equipment or infrastructures, equipment or infrastructure limiting people’s individual rights and freedom, activities which give rise to environmental impact, activities considered ethically or morally controversial or prohibited by national legislation, activities targeting the production or sale of goods which are the subject of an act infringing a trade mark or a geographical indication, gambling and tobacco related activities.
What can an EIB loan be used for?
The EIB loan can be used to finance all investments and expenditures that are incurred in the context of the development of an SME or a MidCap i.e.:
Tangible investments: purchase, renovation or extension of tangible assets, with some restrictions concerning land purchases.
Intangible investments: particularly the expenditure involved in R&D, purchase of process licenses and software
Medium and long-term working capital requirements needed for the operational activity of the SME or MidCap.
What are the benefits for your Business?
You can receive beneficial interest rates compared to standard business lending conditions.
You can negotiate the term or repayment frequency of the loan to suit the circumstances and cash-flow requirements of your business.
It allows you to invest significantly in your business without adversely affecting your cash-flow or liquidity.
What is expected in return?
In case this was requested by the EIB (a) upon reasonable notice, you should permit the EIB representatives to visit and inspect all sites, installations and works that comprise the project which is the subject of the loan; and (b) we may provide information about you to the EIB.
Please contact our Relationship Manager or visit our local branch to discuss if your business qualifies for funding supported by the EIB "Loans for SMEs" or EIB "Loan for MidCaps" scheme.
https://www.eib.org/attachments/strategies/mou_ec_eib_on_external_mandate_en.pdf
|
Access to the Program |