Albania Credit Guarantee Scheme Assessment

Micro, small, and medium enterprises (MSMEs) in Albania are significant contributors to the economy. In 2018, according to the Albanian Institute of Statistics (INSTAT), 99.8 percent of active enterprises were MSMEs, employing 79.8 percent of the w...

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Main Author:	World Bank
Format:	Report
Language:	English
Published:	World Bank, Washington, DC 2020
Subjects:	FINANCIAL SECTOR DEVELOPMENT ACCESS TO FINANCE MICROFINANCE SMALL AND MEDIUM-SIZED ENTERPRISES PUBLIC CREDIT GUARANTEE REGULATORY FRAMEWORK FINANCIAL REGULATION
Online Access:	http://documents.worldbank.org/curated/en/907601595607606723/Albania-Credit-Guarantee-Scheme-Assessment http://hdl.handle.net/10986/34322

id	okr-10986-34322
recordtype	oai_dc
spelling	okr-10986-343222021-05-25T09:54:51Z Albania Credit Guarantee Scheme Assessment World Bank FINANCIAL SECTOR DEVELOPMENT ACCESS TO FINANCE MICROFINANCE SMALL AND MEDIUM-SIZED ENTERPRISES PUBLIC CREDIT GUARANTEE REGULATORY FRAMEWORK FINANCIAL REGULATION Micro, small, and medium enterprises (MSMEs) in Albania are significant contributors to the economy. In 2018, according to the Albanian Institute of Statistics (INSTAT), 99.8 percent of active enterprises were MSMEs, employing 79.8 percent of the workforce and realizing around 69 percent of value added. At the same time, the MSME sector is generally characterized by high informality (especially in agriculture), limited availability of collateral, and low levels of financial capability. Limited access to finance, particularly bank credit, poses a challenge for MSMEs in Albania. MSMEs can only reach their full potential if they obtain the finance necessary to start, sustain, and grow their business. Albania’s financial sector ranks at 102nd place out of 141 countries in the World Economic Forum 2019 Global Competitiveness Report. Credit to the domestic private sector represents only 33 percent of gross domestic product (GDP) compared to above 50 percent in regional peers, reflecting very low levels of financial intermediation. MSMEs – the backbone of the Albanian economy – face significant constraints in accessing finance, with 16 percent of small and 34 percent of medium-sized enterprises reporting access to finance as a major constraint in Albania. The overall MSME finance gap in Albania is estimated at 9 percent of GDP. The Albanian banking sector is extremely liquid and prevailing interest rates are low; however, Albanian banks are reluctant to lend to MSMEs as they perceive the sector as risky and there is a limited secondary market for movable and immovable collateral. Improving access to finance for MSMEs in the country must be tackled in a holistic and strategic manner, addressing supply, demand, and enabling environment aspects. 2020-08-11T14:47:15Z 2020-08-11T14:47:15Z 2020-07-24 Report http://documents.worldbank.org/curated/en/907601595607606723/Albania-Credit-Guarantee-Scheme-Assessment http://hdl.handle.net/10986/34322 English CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Economic & Sector Work Economic & Sector Work :: Other Financial Sector Study Europe and Central Asia Albania
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	FINANCIAL SECTOR DEVELOPMENT ACCESS TO FINANCE MICROFINANCE SMALL AND MEDIUM-SIZED ENTERPRISES PUBLIC CREDIT GUARANTEE REGULATORY FRAMEWORK FINANCIAL REGULATION
spellingShingle	FINANCIAL SECTOR DEVELOPMENT ACCESS TO FINANCE MICROFINANCE SMALL AND MEDIUM-SIZED ENTERPRISES PUBLIC CREDIT GUARANTEE REGULATORY FRAMEWORK FINANCIAL REGULATION World Bank Albania Credit Guarantee Scheme Assessment
geographic_facet	Europe and Central Asia Albania
description	Micro, small, and medium enterprises (MSMEs) in Albania are significant contributors to the economy. In 2018, according to the Albanian Institute of Statistics (INSTAT), 99.8 percent of active enterprises were MSMEs, employing 79.8 percent of the workforce and realizing around 69 percent of value added. At the same time, the MSME sector is generally characterized by high informality (especially in agriculture), limited availability of collateral, and low levels of financial capability. Limited access to finance, particularly bank credit, poses a challenge for MSMEs in Albania. MSMEs can only reach their full potential if they obtain the finance necessary to start, sustain, and grow their business. Albania’s financial sector ranks at 102nd place out of 141 countries in the World Economic Forum 2019 Global Competitiveness Report. Credit to the domestic private sector represents only 33 percent of gross domestic product (GDP) compared to above 50 percent in regional peers, reflecting very low levels of financial intermediation. MSMEs – the backbone of the Albanian economy – face significant constraints in accessing finance, with 16 percent of small and 34 percent of medium-sized enterprises reporting access to finance as a major constraint in Albania. The overall MSME finance gap in Albania is estimated at 9 percent of GDP. The Albanian banking sector is extremely liquid and prevailing interest rates are low; however, Albanian banks are reluctant to lend to MSMEs as they perceive the sector as risky and there is a limited secondary market for movable and immovable collateral. Improving access to finance for MSMEs in the country must be tackled in a holistic and strategic manner, addressing supply, demand, and enabling environment aspects.
format	Report
author	World Bank
author_facet	World Bank
author_sort	World Bank
title	Albania Credit Guarantee Scheme Assessment
title_short	Albania Credit Guarantee Scheme Assessment
title_full	Albania Credit Guarantee Scheme Assessment
title_fullStr	Albania Credit Guarantee Scheme Assessment
title_full_unstemmed	Albania Credit Guarantee Scheme Assessment
title_sort	albania credit guarantee scheme assessment
publisher	World Bank, Washington, DC
publishDate	2020
url	http://documents.worldbank.org/curated/en/907601595607606723/Albania-Credit-Guarantee-Scheme-Assessment http://hdl.handle.net/10986/34322
_version_	1764480661042757632

Albania Credit Guarantee Scheme Assessment

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