The SME Corporation granted Center-invest Bank authorization to work with umbrella guarantees.
The umbrella guarantee system of SME Corporation enables business owners to get a loan even in the absence of appropriate security. The Corporation acts as a guarantor for a bank that up to 50% of the borrower’s loan obligations will be paid should a business owner fail to perform its obligations to the bank.
«Center-invest Bank widely participates in all SME preferential financing programs, thus offering the best conditions for the promotion and growth of regional entrepreneurship. We are confident that the new umbrella guarantee program will be in high demand among businesses in southern Russia as it broadens the range of financing options available to our clients,» said Lidia Simonova, Chairperson of Center-invest Bank’s Management Board.
«Umbrella guarantees are an effective and highly-demanded tool that not only makes it easier for small and medium-sized businesses to secure credit financing on favorable terms, but also makes loans available to businesses that earlier stood no chance of getting loans at all. By taking the bank’s risks, we give it the assurance that the issued funds will be returned, while giving the business an opportunity to function and develop properly even despite the pressure of sanctions and the associated challenges,» said Alexander Isayevich. He emphasized that small and medium-sized businesses can now access credit financing thanks to the SME Corporation’s umbrella guarantees, which also give them the chance to consistently build supply chains, phase-out imported goods, find solutions to problems that prevent them from entering new markets, expand their production, and create jobs.
The mechanism of umbrella guarantees was launched in 2021 in accordance with the Russian Federation President’s executive order and is implemented under the national project for the development of small and medium-sized businesses, which is overseen by First Deputy Prime Minister Andrey Belousov. If a business owner lacks sufficient collateral to secure the loan, the umbrella mechanism is a more straightforward way to obtain bank financing. The Corporation offers a guarantee covering up to 50% of the loan’s total value for a maximum term of 180 months. The maximum allowed amount is one billion rubles. The collateral is issued via the bank’s «single window» system at the time a loan is granted.
Center-invest Bank is a leader in lending to domestic small and medium-sized businesses, modernization of enterprises, development of women’s, youth, and social entrepreneurship. The Bank is able to maintain a high-quality loan portfolio and a low level of customer past-due debts — that is almost two times lower than the national average — thanks to an individualized approach, transparent lending terms, and effective sustainable risk management techniques.
The SME Corporation is an organization encouraging the development of small and medium-sized business. It offers guarantees and sureties for business loans, helps access the procurement programs of the largest customers and assists in bringing the products to retail store shelves. As a federal institute for innovative development, the Corporation also supports high-tech innovative SMEs. Additionally, SME Corporation gives training in entrepreneurial skills and implements business acceleration programs, as well as offers financial assistance via SME Bank and crowdfunding platforms, and funds developing businesses through MIR Management Company.