ARARATBANK attracts USD 5 million from GGF to propel green financing in Armenia

Economy 17 January, 2024 16:10

Boosting green lending for SMEs and households, especially in agriculture, manufacturing, and small-scale renewable energy.

The Green for Growth Fund (GGF), an impact investment fund advised by Finance in Motion, is re-engaging with the leading Armenian SME bank ARARATBANK through the provision of a USD 5 million loan facility. In a significant move to drive sustainable development in Armenia, this strategic partnership with ARARATBANK aims to broaden the network of GGF partners on the ground and provide critical support for green lending initiatives directed at SMEs and retail clients.

The funding will help the Bank in meeting the growing demand for green capital expenditures in key sectors, such as agriculture, food processing, manufacturing, and construction. Additionally, it will support individual households in adopting energy efficient systems and eco-friendly practices, including the implementation of small renewable energy measures.

The Fund’s support extends beyond financing, incorporating a dedicated Technical Assistance (TA) package that is designed to augment ARARATBANK’s capacity for green lending by utilizing GGF’s vast experience and expertise in the field. This aligns with GGF's broader mission to promote sustainable finance practices and underscores a holistic approach to support ARARATBANK’s commitment to green initiatives.

Christopher Knowles, Chairperson of the GGF, expressed enthusiasm about the Fund’s re-engagement with ARARATBANK, stating: “We are very pleased to deepen our collaboration with ARARATBANK, a partner that shares our commitment to driving sustainable development. This loan investment showcases the potential for positive change through collective efforts and highlights our joint commitment to improving energy and resource efficiency to accelerate the country’s green transition.”

Mher Ananyan, Chairman of the Executive Board of ARARATBANK, commented: "We are thrilled to announce our collaboration with the Green for Growth Fund in providing 5 million USD to support small and medium-sized enterprises (SMEs) in their journey towards energy efficiency and renewable energy solutions. This partnership reflects our unwavering commitment to UN Global Principle 8, which urges businesses to undertake initiatives that promote greater environmental responsibility. By empowering SMEs to adopt sustainable practices, we are not only fostering a greener future but also driving economic growth and resilience. Together, we can make a tangible impact on the environment and contribute to a more sustainable world for generations to come.”