Transcapital NBFI has launched a new project in partnership with the European Bank for Reconstruction and Development (EBRD) to support local entrepreneurs.

As a result of the loan agreement between EBRD and Transcapital, micro and small business owners in Mongolia—particularly those in rural areas—will gain increased access to financing, enabling them to withstand the negative impacts of the COVID-19 pandemic and expand their businesses.

The financing of up to MNT 10 billion (equivalent to approximately EUR 2.9 million) provided to Transcapital—one of Mongolia’s leading microfinance institutions and an EBRD partner since 2013—will be used to deliver loans to micro and small enterprises across the country, including in sparsely populated and remote regions.

This marks EBRD’s first loan agreement under the USD-MNT long-term swap facility, established between EBRD and the Bank of Mongolia in January 2021, aimed at increasing local currency financing for businesses affected by the pandemic.

Only a limited number of non-bank financial institutions in Mongolia currently provide financing to rural MSMEs. This EBRD loan will help expand non-bank lending in remote areas and strengthen financial channels directed toward rural businesses.

EBRD operates in Mongolia with the goal of supporting private sector development, improving infrastructure, and fostering a more diversified economy. Since starting its operations in Mongolia in 2006, EBRD has invested €1.86 billion across 114 projects.