The Croatian Reconstruction and Development Bank (HBOR) has announced a new financing programme aimed at investments in the processing of agricultural products. The objective of the programme is to strengthen the competitiveness of domestic agri-food production and increase processing capacity.
The programme is intended for micro, small and medium-sized entrepreneurs, individual farms, trades, trading companies, cooperatives and all legal entities planning investments in the sectors of meat, grain, fruit and vegetable processing. For eligible projects, it is possible to obtain a loan of €200,000 to €3,000,000, and HBOR can finance up to 85 per cent of the pre-invoice value of the investment.
The programme allows for a capital rebate of up to 40 per cent of the total amount of loan principal paid out for users who increase processing or slaughter capacities through the project. Funds can be used to finance the construction of production facilities, the purchase and renovation of existing buildings, the acquisition and equipping of production units, and other investments in the processing of agricultural products.
The loan utilisation period is generally up to 12 months, but a longer period can be approved depending on the purpose and dynamics of the investment. The repayment period is, depending on the purpose and structure of the investment, up to 20 years, including a grace period of up to 3 years.
In addition, HAMAG-BICRO, in cooperation with the Ministry of Agriculture, Forestry and Fisheries, is making a new financial instrument available to farmers: “Loans for the growth of agricultural production in sensitive sectors”. The instrument is co-financed with funds from the European Agricultural Fund for Rural Development.
HAMAG-BICRO will directly approve investment loans to small business entities in the agricultural sector, in accordance with the conditions of the Strategic Plan of the Common Agricultural Policy of the Republic of Croatia 2023 – 2027. The maximum loan amount is €150,000.00, with an interest rate of 0.10 per cent.
The loans are intended to finance tangible and intangible assets in pre-defined sectors of agricultural production, with eligible sectors defined by the programme conditions. A write-off of up to 45 per cent of the principal of the used loan amount is possible, or up to 50 per cent for young farmers, provided that the prescribed conditions are met.
The aim of the financial instrument is to increase the availability of favourable financing for small business entities in the primary agricultural production sector, with a lower interest rate, fewer collateral requirements and the possibility of writing off part of the loan principal.
