Outstanding results of Oschadbank's MSME in 2023: the business line's loan portfolio reached UAH 22 billion

In 2023, Oschad achieved significant growth in its micro, small and medium-sized business (MSME) loan portfolio: it increased by 26% to UAH 22 billion.

Thanks to this, the bank became one of the three market leaders in terms of MSME loan portfolio last year.

The growth was even across all segments of micro, small and medium-sized businesses and is currently formed from equal components in these business segments.

In the context of martial law, Oschadbank focuses on active financing and servicing of business clients in several areas, including business relocation. Thus, in 2023, 26 enterprises were relocated to safe regions of the country with the financial support of the bank in the amount of UAH 224 million. As a result, businesses and more than a thousand jobs were saved.

Last year, Oschad was one of the key banks supporting business and the economy of Ukraine, having financed 4.5 thousand enterprises employing more than 120 thousand Ukrainians. The total amount of funds provided to them amounted to UAH 13.3 billion, of which UAH 6.9 billion was allocated to financial support of agricultural enterprises and to meet the needs of farmers, including the sowing campaign. 75% of all loans were granted to micro-businesses (annual revenue of such enterprises does not exceed UAH 30 million).

This result was achieved, in particular, due to various programs to help Ukrainian businesses (state, regional, international) offered by Oschadbank, as well as by simplifying the financing mechanism and liberalizing its terms. Currently, MSME clients can submit an online loan application and receive a preliminary decision within 24 hours using the OschadBusiness service. By the end of 2023, 1,400 online loan requests were submitted by MSME clients. Thanks to the additional channel, the incoming loan application flow increased by 20%.

Oschadbank is one of the leaders of the "Affordable Loans 5-7-9%" program, which remains the main driver of business lending and provides financing in all areas, including in the frontline regions of the country, to restore business activity: expansion of industrial parks, support for the agro-industrial complex (AIC) in terms of both sowing and processing, plant protection products, financing export-oriented businesses, ensuring food security, etc. In total, over UAH 11 billion of such loans were issued to MSMEs last year.

In 2023, Oschad was and remains an authorized bank of the eRobota program. During the year, 10,000 entrepreneurs received over UAH 5.5 billion in grant assistance through Oschadbank. Recently, the program launched a new area aimed at supporting and developing veteran businesses. A total of 194 such grants worth UAH 75 million have already been funded.

"Steady growth of the MSME loan portfolio last year is a positive trend. In the context of the full-scale war, we primarily focused our efforts on supporting businesses in the de-occupied and frontline territories, helping them relocate and develop in safe areas of the country. We not only offered more flexible terms for our own products, but also attracted grant support from the government and international organizations. We cooperate with regional authorities to reduce the cost of loan programs for entrepreneurs. In addition, we have many partnership programs that help develop strategically important sectors of the economy and support micro, small and medium-sized businesses in Ukraine," said Natalia Butkova-Vitvitska, Oschadbank Management Board Member in charge of MSMEs.

Our business credit support toolkit includes several joint initiatives with regional military administrations (RMAs). Memorandums have been signed with Zakarpattia, Chernivtsi, Lviv, Odesa, Ivano-Frankivsk, Kyiv, Mykolaiv, Rivne and Sumy regions, as well as with the cities of Ivano-Frankivsk, Dnipro, Pokrovsk and Kyiv to reduce the cost of loans for local entrepreneurs.

Thanks to this mechanism, in 2023, interest on loans to MSMEs in the amount of more than UAH 5.2 million was additionally compensated at the level of regional budgets of the OBA under the programs of energy supply to their own businesses, development of processing enterprises, etc.

Oschadbank was the first bank in Ukraine to cooperate with the Export Credit Agency (ECA) to support exporters and introduce portfolio risk insurance for loans granted to fulfill foreign economic contracts. During the period of cooperation with the ECA, the bank issued loans totaling UAH 245 million, with the volume of financed export contracts amounting to UAH 4.1 billion in equivalent.  This is the highest figure among all banks participating in the program. All loans are insured by ECA for 85% of the amount.

In 2023, the bank provided loans worth UAH 3.4 billion through the partner sales channel. Oschad currently has more than 300 partnership programs with dealers of global brands JOHN DEERE, CLAAS, NEW HOLLAND, PÖTTINGER, SYNGENTA, ADAMA and the largest players in the domestic market - UKRAVIT, ALFA SMART AGRO.

Oschad successfully implements projects with international financial organizations under the guarantee mechanisms of the European Investment Bank (EIB), the European Investment Fund (EIF), etc. and grant programs (Sparkasse, Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ)). The Bank is the largest lender to businesses under government guarantees on a portfolio basis. The portfolio guarantee instrument reduces collateral requirements for loans and facilitates customers' access to credit funds for the implementation of their business projects. For example, under the partnership with the EIB, the guarantee limit is already EUR 100 million, which makes it possible to service a loan portfolio of at least UAH 4 billion.

In addition, through the integration of grant programs into loan instruments, the client can receive additional grant funds as a compensation mechanism for the purchase of fixed assets (processing, production, logistics). In 2023 alone, Oschadbank provided 87 million in grants from the German government to MSMEs in Ukraine. More than 68% of grantees are registered and operate in war-affected areas or in the de-occupied territories.

Cooperation with international partners is also carried out in the framework of additional areas of financing, including socially oriented projects (WNISEF fund).

In 2023, Oschadbank's programs for MSMEs were recognized as the best in the nomination "Best Bank Loan Product for Business" at the PaySpace Magazine Awards 2023. Oschad also won in the "Loans to SMEs and Individual Entrepreneurs" nomination according to FINANCIAL CLUB AWARDS and became the winner of the PR case competition from Marketing Media Review in the "B2G Project" nomination for the best case of business interaction with the state.