Public Call for Participation in the Entrepreneurship and Self-Employment Promotion Program

The Ministry of Economy has issued a public call for applications for loans secured by a guarantee from the Development Fund and participation in free training under the entrepreneurship and self-employment promotion program. The entrepreneurship and self-employment promotion program is implemented by the Public Investment Management Office in cooperation with the Development Fund of the Republic of Serbia and with expert support from KfW. Micro, small and medium-sized enterprises and entrepreneurs have the right to apply for a loan from a partner bank and for a grant. The program also encourages financing for young entrepreneurs aged 18-35, women entrepreneurs, returnees and entrepreneurs investing in the agricultural sector. MSMEs and entrepreneurs must be start-ups. If a business is already operating, it must have been in operation for no more than 24 months when the application is submitted. The program consists of 4 components:

1. A guarantee for loans approved by commercial banks selected to participate in the Program through a public call. The guarantee covers 60% of each individual loan, including the regular interest amount (for delays of up to 90 calendar days from the date of the last unpaid installment), within the maximum projected loan portfolio for each partner bank. The commercial bank retains the remaining 40% of the risk. 2. Approval of favorable bank loans by partner banks 3. Disbursement of grants to borrowers who meet the conditions set out in the Program 4. Provision of expert, free assistance and support in preparing a business plan and ongoing business operations through a mentoring program run by the Serbian Chamber of Commerce.

In accordance with the Program, loans approved by partner banks may be used to finance investments (purchase of production equipment, machinery, facilities, seedlings, purchase or adaptation of business or production premises, etc.) and to finance operating expenses in accordance with the internal procedures and credit policy of the commercial bank. The types of expenses considered operating expenses will be determined by the partner bank’s internal regulations. Loan funds may not be used to finance activities whose financing is prohibited under the latest list of such activities issued by the International Finance Corporation (IFC), or to finance other activities whose financing would be contrary to domestic regulations, concluded international agreements, or the purpose and objectives of this program. Loan funds may not be used for: – payment of loan installments or loan restructuring; – repayment of a loan with another bank. Operating expenses may account for no more than 30% of the total investment structure. The terms applicable to investment loans will also apply to this portion of the loan. The total funds available for implementation of this Program amount to 300.000.000,00 dinars. Of these funds, 250.000.000,00 dinars are earmarked for implementing the Entrepreneurship and Self-Employment Promotion Program, while 50.000.000,00 dinars are earmarked for the costs of implementing the training and mentoring program. Businesses meeting the Program’s requirements may qualify for financial support in the form of grants amounting to up to 20%, depending on the investment amount. An investment is an undertaking financed with funds from the Program and does not include the loan beneficiary’s contribution. Applicants wishing to participate in the Program can learn about it and its terms on the websites of the Ministry of Economy, the Development Fund, the Chamber of Commerce and Industry of Serbia, and the Public Investment Management Office.