The management of the Development Bank (DB) is focused on supporting IPARD projects this year, as expressed by its representatives, who also noted there is significant interest in these projects.
“We hope that through the IPARD III program call, we will support a large number of agricultural households and businesses operating in rural areas,” said the DB representatives to Mina-business.
They added that the Investment and Development Fund (IDF), which is the legal successor of the Development Bank, implemented 139 projects last year through IPARD, totaling 8.5 million EUR. This represents 105 more projects and a 30% increase in funds compared to 2023. From 2015 to the previous year, the IDF had implemented 553 investments through the IPARD program, totaling over 40 million EUR.
According to DB, the IPARD program is crucial for Montenegro’s economy as it provides grants and favorable credit lines for the development of agriculture and rural areas.
“Through these programs, farmers and entrepreneurs can modernize production, increase competitiveness, and align their operations with EU standards, opening doors to new markets,” stated DB representatives.
The Development Bank focuses on IPARD because it recognizes its potential to stimulate sustainable economic growth, create new jobs, and reduce dependence on agricultural product imports.
“The greatest contribution of the IPARD program is the modernization and improvement of agriculture and rural areas through investments that increase productivity, competitiveness, and sustainability of the sector. It provides access to grants and favorable loans for technological modernization, quality and standard improvement, and sustainable production,” the bank representatives said.
They reminded that DB is a traditional partner of the IPARD program and has had a long-standing successful collaboration with the Ministry of Agriculture, Forestry, and Water Management, particularly in supporting projects.
“For all agricultural producers and businesses participating in the IPARD Ministry’s grant scheme, we have defined favorable financing conditions. Specifically, our offer includes the IPARD credit line for agricultural development, which ensures favorable financing conditions with a fixed interest rate of 4% and repayment periods of up to 12 years with a grace period of up to four years, depending on the project’s complexity,” the DB representatives stated.
The loans are intended to support agricultural households and businesses in line with the Ministry’s call.
“Loan beneficiaries can be agricultural producers, micro, small, and medium-sized enterprises that have received a decision from the Ministry of Agriculture confirming their participation in the IPARD program,” explained DB.
They also added that in the past period, they have worked to make funds more accessible to agricultural producers and ease the process of gathering them.
“We have ensured conditions to simplify the approval process for credit funds for the IPARD program, aiming to maximize their use. We have created a system where most of the documentation is obtained from the Ministry of Agriculture, thus making the process easier,” said DB representatives.
They clarified that all potential clients must have a signed grant agreement with the Ministry of Agriculture related to the IPARD project. Also, the final users of the loan arrangements must obtain confirmation from the Revenue and Customs Administration that they are in compliance with tax obligations.
“RB’s expert teams analyze each project individually, so our personalized approach allows us to best understand potential investments and their economic justification, leading to the best decisions for the potential loan beneficiaries. The Development Bank makes a special decision on each request,” said DB.
The Development Bank accepts bills of exchange, administrative bans, mortgages on real estate, and other collateral typical in banking operations.
“Loan recipients, after meeting conditions and completing the investment in accordance with IPARD rules, will be eligible for a refund, which reduces their credit exposure. The Ministry of Agriculture handles the activities related to the refund process,” said DB representatives.
They believe that connecting agriculture with commerce and tourism, through the diversification of economic activities in rural areas, is becoming increasingly important.
“There is a growing demand for agricultural products, stimulated by significant projects in the tourism sector. Generous grants, established cooperation with an emphasis on favorable credit conditions, are more than enough reason for most farmers to choose to realize their business ideas using the DB’s credit arrangements and the IPARD instrument,” concluded the bank representatives.
