Small and medium-sized business’s loan portfolios grew by 43% by November 1 in Bashkiria

As of November 1, 2022, the loan portfolio of legal entities in the republic’s banks amounted to 415 billion rubles, which is 5.7% higher than a year ago, the National Bank of the Republic of Bashkortostan reported.

The low investment activity of large businesses explains this very moderate growth. “Due to economic uncertainty and trade restrictions, many investment projects have been suspended. At the same time, enterprises need borrowed funds, incurring additional costs in the face of more complex logistics and international settlement mechanisms. This is typical, for example, for metallurgy, engineering, transport, energy, and several other industries,” comment the analysts of the National Bank.

At the same time, lending to small and medium-sized businesses in Bashkiria continues to grow much faster. Over the year, the SME loan portfolio grew by 43% to 147 billion rubles.

“In the process of structural transformation of the economy, small and medium-sized enterprises are showing greater flexibility, gradually adapting to work in new conditions. State support measures also have an impact. These include concessional lending, credit holidays for mobilized SME owners, reduction or full compensation of costs for accepting non-cash payments,” experts explain.