Thousands of businesses in Armenia will find it easier to access credit thanks to a nearly €70 million financing package from the global arm of the European Investment Bank (EIB Global) and the European Commission.

EIB Global is lending a total of €58.5 million to three Armenian banks – Inecobank, ArmSwissBank and Farm Credit Armenia – to expand credit for micro-, small and medium-sized enterprises (MSMEs) in the country. The European Commission is adding an €11 million grant for the banks to meet growing demand for long-term local currency financing for Armenian MSMEs.

“We are pleased to step up our support for MSMEs in Armenia, partnering with local financial institutions,” said EIB Vice-President Teresa Czerwińska. “The EIB is dedicated to fostering entrepreneurship and inclusive growth in the country, helping businesses overcome barriers to their development. As we address the pressing need to enhance access to long-term finance, including in local currency, we pave the way for a more resilient and innovative future for Armenia’s business ecosystem.”

The financing package was finalised during a conference in Yerevan on promoting green and inclusive growth in Armenia’s MSME sector. The event brought together representatives from the public and private sectors, including financial institutions.

Head of the EU Delegation to Armenia, Ambassador Vassilis Maragos said, “With this support to the Armenian MSMEs, we are delivering on our commitment to further support Armenian private sector and contribute to addressing the pressing need for access to finance. We will build on these efforts by delivering a total of €270 million under the Resilience and Growth Plan in the period 2024-2027. A significant portion of it will be dedicated to business development, particularly in the tech sector, start-ups and new export opportunities, which will support Armenia’s economic diversification. This assistance is part of the Economic and Investment Plan (EIP) for Armenia which is a comprehensive initiative aimed at fostering economic growth, sustainable development, and prosperity in the country.”

One of the three EIB Global loans is a €40 million credit line to Inecobank. This first direct cooperation with Inecobank will contribute to the growth and competitiveness of Armenian MSMEs and promote entrepreneurship in line with the priorities of the European Union and Armenia.

"By joining EIB, we are marking our first direct partnership, complementing the successful collaborations we have shared indirectly in the past," said Chief Executive Officer of Inecobank Hayk Voskanyan. "By expanding access to long-term financing, this initiative will equip Armenian SMEs with the tools they need to grow, innovate, and thrive. We look forward to supporting this initiative and, in turn, witnessing the positive ripple effects on entrepreneurship and innovation."

The EIB has also joined forces with ArmSwissBank for the first time, providing it with a €16 million credit line. This will enable ArmSwissBank to boost financing for businesses across Armenia and contribute to inclusive economic growth in the country with part of the amount to be allocated to women-led businesses.

“The collaboration with the EIB will enable ArmSwissBank to support a wide range of businesses, including those led by women," said Chief Executive Officer of ArmSwissBank Gevorg Machanyan. "This initiative will help drive economic growth in Armenia while also promoting environmentally friendly practices. Together, ArmSwissBank and EIB Global are committed to fostering innovation and growth in the Armenian business community.”

The third loan of €2.5 million to Farm Credit Armenia marks EIB Global’s first partnership with a microfinance institution in Armenia. The funds will be used to stimulate the development of businesses owned or led by farmers, young people or women entrepreneurs, including in rural areas.

Emphasizing the significance of the collaboration, Armen Gabrielyan, Chief Executive Officer of Farm Credit Armenia said “We are thrilled to partner with the European Investment Bank. This significant support will empower us to extend enhanced services to farmers and agribusinesses, providing them with the essential funding needed to thrive and contribute to community development. Together, we aim to fortify Armenia's agricultural sector and foster tangible, positive change in our communities.”

The whole package contributes to the European Union’s goal of supporting 30 000 MSMEs in Armenia and fostering sustainable, innovative and competitive growth as outlined in the EU Economic and Investment Plan for the Eastern Partnership.

Background information

About the EIB and EIB Global

The EIB is the long-term financing institution of the European Union, owned by the Member States. It provides long-term finance for sound investments in pursuit of EU policy goals, supporting projects in four priority areas: infrastructure, innovation, climate and environment, and micro-, small and medium-sized enterprises (MSMEs).

EIB Global is the EIB Group’s specialised arm devoted to increasing the impact of international partnerships and development finance, contributing to the three overarching priorities of the European Union: the European Green Deal, the Global Gateway and jobs, and sustainable and inclusive growth. Within Team Europe, EIB Global fosters strong, focused partnerships alongside fellow development finance institutions and civil society, in close cooperation with other multilateral development banks. EIB Global brings the EIB Group closer to local people, companies and institutions through our offices around the world including the EIB Regional Representation for the South Caucasus covering Armenia.