The Bank of Moscow announced on Tuesday that loans to small businesses that are covered by the Loan Guarantee Agency of the Non-Bank Deposit-Credit Organization (LGA) would have their interest rates lowered.
"Establishing the most attractive and accessible loan conditions for small businesses is one of the top priority tasks for the Bank of Moscow," Director of the Small Business Department of the Bank of Moscow, Ekaterina Orlova, said. "By reducing loan rates, provided that these loans are secured by the Loan Guarantee Agency, we achieve two goals, namely we cut the costs of usage of borrowed funds for small companies and resolve the issue essential for many small businesses, which is the lack of security for crediting."
The LGA was established in 2014; it provides support mechanisms for its partner banks, which allows banks to loan to more small and medium-sized enterprises (SME), with the agency sharing some of the risk.
The Bank of Moscow was one of the first to join as a partner bank. The agency cuts costs normally taken on by the bank, allowing the institution to pass savings along to SME clients.