Moldova: How to help your business recover after COVID

September 9, 2021

  • COVID hit my business badly. Where can I get some financing to recover?
  • How do I apply for a bank loan? What are the requirements?
  • I’ve heard about loans, but are grants also available to small companies?
  • The pandemic showed that there is sustainable demand for my business. How can I get knowledge, advice and skills needed to scale up my business?
  • I think exporting to the EU could help my business recover. Where do I start?
  • Are there SMEs like me that got help?
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COVID hit my business badly. Where can I get some financing to recover?

The EU offers financing and guarantees to local financial institutions to unlock lending. This makes it possible for the local lender to provide more affordable financing to SMEs. For instance, you could benefit from lower-interest loans, longer repayment terms, lower collateral requirements, including some loans based in lei instead of foreign currencies. Check what these banks in Moldova have to offer under the EU4Business Initiative: MAIB, Victoriabank, BCR Chisinau, Mobiasbanca, ProCredit Bank Moldova, BT Leasing, BC “Comerțbank” SA, BC “Energbank” SA, BC “Moldindconbank”SA.

Here are some examples of SME owners who benefited:

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Nicanor Negru scaled up his honey-making business Regina Naturii to new heights with a loan from the  EU4Business-EBRD Credit Line (with up to 15% cashback) supported by the EU. The EU also supported his company in establishing a recognised brand identity, smart packaging, and a catchy web design to boost sales.

Constantin Cojocari, CEO of the Moldovan clothing brand VASCONI, received a €20,000 loan from the EBRD and EU4Business that helped transform the company over several years into a modern, technologically savvy business with 114 employees.

How do I apply for a bank loan? What are the requirements?

The EU offers a wide range of options for different types of SMEs. For instance, the EU provides concessionary loans to underserved micro-enterprises and low-income households as well as SMEs that want to invest in state-of-the-art technologies, including energy efficiency, business modernisation and alignment with EU standards.

There are also attractive opportunities for businesses seeking to boost trade with the EU and upgrade their businesses to EU standards.

You can check the conditions for the EU partner banks on the EU4Business website and just call the bank directly. Remember to mention the programme. Very simple!

I’ve heard about loans, but are grants also available to small companies?

Yes, there are!

For instance, the Rural SME Policy Support Window offers grants to SMEs in rural areas to better access the means and services for business development.

If you are interested in STEM topics and innovation, or want to create a startup in the innovative sector and prepare for investment, the Startup City Cahul programme with a grant component may be suitable for you. Maybe your idea will change the world!

The pandemic showed that there is sustainable demand for my business. How can I get knowledge, advice and skills needed to scale up my business?

To support SMEs like yours, the EU assists local business associations and agencies, leading to SME growth. Just check all available business development opportunities, pick the one that suits your needs, and get in touch directly with the organisation!

For instance, the Rural SME Policy Support Window offers advisory services and training support to SMEs in rural areas to better access the means and services for business development.

If you are interested in STEM topics and innovation or want to create a startup in the innovative sector and prepare for investment, Startup City Cahul programme may be suitable for you.

If you are from Cahul or Ungheni region, you may benefit from the EU4Moldova: Focal Regions Programme, which provides business advice and training to stimulate private investment development, the clustering and value chain approach in key economic sectors.

Women-led business may benefit from the EU4Business Women in Business Advisory Programme implemented by the EBRD to access know-how to transform their businesses. This covers a wide range of topics, from the technical knowledge to build a website, for example, or to introduce a quality management system that meets ISO standards, improve energy efficiency or improve Human Resources management. These usually involve working with qualified local consultants with a portion of the net costs reimbursed.

The LEADER approach for rural prosperity in Moldova supports Local Action Groups (LAGs) in rural areas to implement strategies for local growth. Rural development and innovative projects that have potential to contribute to economic growth may receive advisory services and consultancy support.

You can even make sure your voice is heard in the national reform process and help your government to better understand issues affecting SMEs like yours! Just check the business enabling environment activities in Moldova supported by the EU.

I think exporting to the EU could help my business recover. Where do I start?

Indeed, that’s a great way to scale up your business! And we have something interesting to offer.

The EU4Business: Connecting Companies project supports SMEs with exports going to EU countries. You can apply for training, coaching and even matchmaking with businesses in the EU.

The EU4Business Eastern Partnership Trade Helpdesk will facilitate you in identifying trade obstacles and better understanding regulatory and procedural issues in trading goods and services. Soon, this one-stop-shop online platform will be available that will offer access to trade information (tariffs, non-tariff measures, taxes, trade statistics and procedures).

Alongside financial support, the following programmes provide consultancy and business development opportunities for SMEs to better utilise the free trade opportunities: the DCFTA Initiative East by EIB that supports SMEs in agri-food sector, and the DCFTA Programme by EBRD may help you to resolve the challenges utilising the opportunities offered by the DCFTA. The DCFTA SME Direct Finance Facility helps SMEs identify quality capital investment projects.

Are there SMEs like me that got help?

There are more than you can imagine! Between 2019-2020, 38,636 SMEs in Moldova received support through the EU4Business Initiative. Among those, a total of 553 entrepreneurs received loans for a total value of €101.16 million under EU programmes that support SMEs. Over 37,364 consultancy services were delivered to SMEs. 11,418 new jobs were generated as a result of this support in 2020 alone.

Here are some success stories from SMEs like yours:

Gheorghe Avornic, founder of Litterarum Lyceum, benefited from a loan with grant elements from an EBRD-EU4Business credit line through Victoriabank that awarded it a 15% cashback. This financial opportunity let him rehabilitate the school building, taking down the old soviet roof and adding another storey. They changed all the windows and restored all the networks.

Denis Corabliov and his eco bag-making business Sacose.md obtained a grant under the EU4Business-EBRD Credit Line and bought an automated production line. This helped him diversify his offerings. In the middle of the pandemic, they started producing protective masks and gowns due to its high production capacity, and exporting medical equipment to countries like France and Italy.

Click here for more success stories to learn about Romanian SMEs that are doing business in many different areas and have benefitted from EU support.

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