OREANDA-NEWS. April 17, 2008. Stepping up its support for microfinance in Azerbaijan the EBRD is providing finance to some of the country’s leading institutions in the sector. The EBRD is extending a \\$1 million loan to Norwegian Microcredit LLC (“Normicro”) and is participating in the second capital increase of Microfinance Bank of Azerbaijan. The financing will be used for on-lending to micro and small enterprises (MSEs) especially in rural areas of Azerbaijan, reported the press-centre of EBRD.

Normicro has been operating in Azerbaijan since 1998 and is gradually expanding its regional presence, covering 12 districts of the country. Normicro works with the smallest entrepreneurs. The EBRD funds will be used for small loans up to a maximum of \\$10,000, whereas currently the average loan size for Normicro stands at \\$752. The EBRD finance will enable Normicro to significantly expand its loan portfolio and reach out to new customers. This loan will be complemented by a technical assistance grant to support institution building through the introduction of best practice in lending, staff training and investments in equipment and software.

As a shareholder in Microfinance Bank of Azerbaijan since October 2002 the EBRD has always supported the development and expansion of the bank actively. The new capital increase will assist in deepening the outreach of the Microfinance Bank of Azerbaijan, the only specialised bank and leading provider of financial services to MSEs in the country.

Francis Delaey, head of the EBRD’s office in Baku, said that with these new commitments the EBRD was demonstrating its dedication to support the sustainable development of Azerbaijan. “Micro and small enterprises are playing a key role in the diversification of the country’s economy and in unlocking its potential. The EBRD sees its goal in enabling and promoting private entrepreneurship for the benefit of the whole economy”, he added.

Through its micro and small enterprises programmes, the EBRD has supported over three million small enterprises throughout eastern Europe, Russia, Central Asia and the Caucasus. The EBRD currently works with 105 commercial banks and non-bank microfinance institutions to establish or expand specialised micro and small business finance units and to date has lent over ?1 billion to leverage just under ?15 billion in loans to micro and small businesses in the region.