FACT SHEET: Development Credit Authority Loan Portfolio Guarantee in Bosnia and Herzegovina

Project Snapshot
Total Portfolio Guarantee:  $20 million
Project Duration:  2015-Present
DCA Partner Banks:  Procredit Bank and Sparkasse Bank
* Jointly financed with the Swedish International Development Cooperation Agency (Sida) 
The Challenge
Local small and medium-sized enterprises (SMEs) in Bosnia and Herzegovina (BiH) are often unable to obtain suitable financing because of high collateral demands, high interest rates, and a lack of loan products for SMEs. They cite access to finance as a major obstacle to making new investments and financing working capital. BiH banks often have doubts about the fundamental competitiveness of local SMEs, and they are reluctant to lend to SMEs that do not have substantial collateral. Strengthening local banks’ ability to finance medium- and long-term loans to SMEs in productive sectors of the economy will foster economic growth in BiH.
Our Program
The Development Credit Authority (DCA) Loan Portfolio Guarantee facility is jointly financed by USAID and the Swedish International Development Cooperation Agency (Sida). The project mobilizes private capital to finance development initiatives in BiH and demonstrates the economic viability of such investments to the local banking sector. The program's credit guarantees improve access to finance for SMEs and capitalize on technical assistance through other programs. 
The DCA program provides banks with a 50% guarantee on the loan principal. This enables them to make longer-term loans without substantially increasing their risk exposure and to extend loans to borrowers who otherwise may not qualify for loans under the banks’ regular lending parameters. 


Last updated: April 27, 2017

Share This Page