Through the Loan agreement of the Central Bank of Armenia (CBA) with the European Investment Bank (EIB) signed in October 22, 2018, the “Private Sector Facility” loan program (hereinafter, EIB Program) was launched, which is 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.

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 the EIB Program. The SMEs and MidCaps are gaining financial advantage in terms of interest rate reduction at least by 25 basis points and in the sub-loan agreements signed with the Final Beneficiaries are 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 (

Within the framework of the EIB Program, 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 will not exceed 7.5 years) and it can be used to finance from very small projects to investments with a maximum project cost of EUR 25 million, however, the EIB’s contribution, 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;
  • Agricultural production, agro-processing and tourism are eligible sectors. Only a few sectors are not eligible, such as 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.

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.

The EIB Program allows SMEs and MidCaps to receive beneficial interest rates compared to standard business lending conditions.

Within the framework of the EIB Program, SMEs and MidCaps 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.

Please, contact the EIB Program partner financial institutions to discuss if your business qualifies for funding supported by the EIB "Loans for SMEs" or EIB "Loan for MidCaps" scheme.

International Cooperation and DevelopmentDelegation of the EU to ArmeniaIPC

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