REACH project launchesEconomy
Ulaanbaatar /MONTSAME/ A ceremony took place on Wednesday to commence the REACH project for small- and middle-sized business to be co-implemented by the United States Agency for International Development (USAID) and the “Developmental Solution” NGO.
The US Ambassador to Mongolia Jennifer Zimdahl Galt made the opening remarks at the ceremony, saying that the USAID is funding the REACH project with the objective of increasing access to credit for small and medium-sized enterprises across Mongolia – to improve under-served SMEs’ access to finance in a way that will lead to financially stronger and sustainable business. The goal is to assist SMEs to borrow a minimum – a minimum - total of USD 25 million over the next two years, she said.
“REACH proposes to achieve this ambitious goal by matching potential borrowers and their needs with appropriate lenders and production inputs. It will help client SMEs qualify for these loans by making available specific technical assistance – this could include preparing a solid business plan, setting up accounting systems derived from international financial institutions, improving financial or back-office operation systems, or perhaps simply helping borrowers understand the lending documentation that can vary from bank to bank,” the Ambassador said. She added the project is also partnering with the Government of Mongolia’s Credit Guarantee Fund, which can provide credit guarantees of up to 60 percent of individual loan amounts by these banks to SMEs. This will reduce the credit risks of the banks and allay their concerns about lending to these important clients.