NEW SCHEMES FOR ADVANTAGEOUS FINANCING OF SMALL-SIZE BUSINESS
Negotiations with DSK Bank for advantageous financing of micro- and small-sized firms and of private producers in agricultural regions will be finalized by the end of next week. Immediately after that two new schemes under the Employment through Support of Business (JOBS) project will be launched, insiders told the Banker weekly. The project, worth a total of USD7MN, is to be implemented within two years. It will be carried out jointly by the Ministry of Labour and Social Policy and the UN's Development Programme. The project includes 1/8 of Bulgaria's population and 21 municipalities, chosen because of their high rate of unemployment and the low index of human development as per UN's scale, Elena Panova, who heads the project, explained the criteria.
The projected investments will help the private sector in these municipalities. The aim is to facilitate local economic development as well. The financial support will be coordinated by 21 agro-business centres and nine business incubators. More than half of them have already been set up, and all will open doors by end-July, the project's representatives specified for the Banker weekly. Each local centre now has at its disposal a revolving fund of USD100,000.
Access to financing will be enjoyed mostly by micro- and small-sized firms, which usually have no other way to get credits. However, they will have to prove their ambition to expand and create additional working positions. Farmers, producing to satisfy their own needs, who possess enterprising potential, will also have a chance to get loans.
Two financial schemes for utilization of the money have been worked out. One of them is intended for purchase of equipment - machines and other agricultural utilities on leasing terms. The other financial scheme projects that JOBS will guarantee to banks for the release of credits to entrepreneurs. The extended loans are meant for turnover capital, investments, repair of buildings, purchase of seeds for sowing, etc. The credits are inteded for core activities and not for trade purposes, Ms Panova specified.
There is yet another opportunity: for additional financing of regions, included in the JOBS project. It is still more advantageous as the money will not have to be paid back. Such an opportunity is offered by the Special Projects Fund, which has USD200,000 at its disposal. Groups of private producers and local associations of farmers may apply for such financing. In order to be nominated, however, the candidates should be ready to develop new market niches, offer new services, and initiatives for training or employment. After evaluation the best projects shall be granted by the Fund USD5,000 to 15,000.