Kazakhstan: Small and Medium Enterprise Investment Program (Tranche 2)
Limited access to medium-term credit constrained small and medium enterprises (SME) to exploit opportunities, achieve potential growth, increase employment, and contribute to sustainable economic growth in Kazakhstan. In line with the government’s priority to develop the SME sector, the Asian Development Bank (ADB) approved a multitranche financing facility (MFF) for the Small Enterprise Investment Program (SMEIP). Like tranche 1, tranche 2 was a financial intermediation loan to Damu Entrepreneurship Development Fund (Damu)—to be onlent by participating financial institutions to SMEs. The MFF was designed to address the lack of domestically mobilized resources for medium-term lending to SMEs in local currency. Under tranche 1, the MFF made credit available to SMEs and increased the lending services of Damu and the three participating financial institutions during the period of domestic banking crisis. However, the $150 million provided under tranche 1 was able to generate an increase of only about 2,300 in SME loan accounts, which was short of the targeted 28,693 increase in SME loan accounts.
This report validates the completion report's assessment of the program. IED overall assessment: Less than successful.