Affordable Loans for SMB

The “Affordable Loans for SMB” program implemented by the Far East Development Fund in cooperation with partner banks is designed to reduce the interest rates and extend the loan terms for entrepreneurs in the Russian Far East. Under the program, over 870 projects have received RUB 18.9 bln in total financing.

Projects:

1.    Alenka Child Health Center

Creation of the largest private child health center in the Russian Far East was supported by the FEDF. The project initiator received soft financing under the “Affordable Loans for SMB” program in the amount of RUB 29 mln at the rates significantly below the market rates. This money was used to purchase modern equipment. The company is a resident of the Free Port of Vladivostok.

In 2019, the Alenka Center was named the winner of the Development Award 2019 contest for the best investment project in the “Best SMB Project” category. Alexander Shumatov, General Director of Child Health Center LLC, received the winner’s certificate personally from D.A. Medvedev, Prime Minister of the Russian Federation, Chairman of VEB.RF Supervisory Board. Besides, the project is the prize-winner of the “Star of the Far East” community and business award that was established with support of the office of Yuri Trutnev, Deputy Prime Minister of the Russian Federation — Plenipotentiary Envoy of the President of the Russian Federation to the Far Eastern Federal District.  

 

2.    Medical Equipment for A Health Center

The modern ZDOROVYE center in the Primorye Territory has provided a comprehensive range of healthcare services since 2005. The loan funds raised under the “Affordable Loans for SMB” program were allocated to procure medical equipment making it possible for the company to broaden the range of diagnostic services offered to the population.

Oleg Nomerovsky, Director: “We chose to join the program due to the low interest rate. We have not used any government support programs before, but we are very pleased that the Fund made it possible to reduce the loan rate”.

 

3.    Manufacture of Construction Materials

For over 16 years, the businessman has been engaged in sales of construction and finishing materials under a well-known brand in Blagoveshchensk (Stroymarket retail chain). The loan raised under the program co-sponsored by the Fund and Sberbank will be used to procure construction materials (dry mortars, ceramic tiles for interior decorations, linoleum).

Oleg Berezhnov, businessman: “We are very pleased. Entrepreneurs traditionally welcome this type of programs. We need as many programs of this sort as possible. The lower the interest rate, the bigger the loan that the company will be willing to raise”.

 

4.    Expanding Production of Construction Materials

Trinity is a company that was founded in Yuzhno-Sakhalinsk in 2010 and manufactures construction materials, including insulation and corrugated boards. The company is growing fast — its output increases by 10% every year. The loan proceeds under the “Affordable Loans for SMB” program will be used to expand production capacities.

Alexei Bondarenko, CEO, Trinity: “We chose to use the credit lever to expand production. We opted for the “Affordable Loans for SMB” program due to the interest rates and loan terms — 12% per annum for 5 years. We did not have any opportunities to raise loans on similar terms in the past. I have high hopes that this program will facilitate business development”.

  

5.    Opening a New Cafe

The loan was raised by an individual entrepreneur from the Primorye Territory to promote a new public catering business and create new jobs. The funds were allocated to erect a building, open a cafe, and purchase furniture and equipment.

 Vasily Bashtovoy, businessman: “The first benefit of the program that I have joined as a participant is reduction of loan rates, and the second — extension of the loan term up to 10 years”.

 

6.    Purchasing New Agricultural Machinery

The businessman produces crops, predominantly, soybeans, and sells them. He has no processing facilities of his own. He has been in the market for 25 years already. At first, he grew vegetables on 100 ha of land at his disposals. Now, the area he cultivates has reached thousands of hectares. The businessman used the loan funds raised under the “Affordable Loans for SMB” program to purchase new agricultural machinery, which made it possible to reduce the vehicle service and maintenance costs and improve crop yield.

Alexander Kubarev, businessman: “The SMB support lending program proved handy. The primary reason that determined my choice is the low interest rate — other banks would not extend loans at an interest rate below 16.5%.


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