Bank of Albania refocuses its MSME Financing Programme to boost bank lending to agriculture

The Bank of Albania published Governor Gent Sejko’s remarks at a roundtable co-organised with the Ministry of Finance on bolstering credit to Albania’s agricultural sector, framing agricultural lending as a persistent structural weakness and calling for a shift in banks’ approach. Sejko stated that the central bank has aligned its Financing Programme to micro, small and medium-sized enterprises (MSMEs) to place greater emphasis on growing credit to agriculture. Sejko highlighted the scale mismatch between agriculture’s role in the economy and its access to finance, noting that the sector accounts for around 20% of Albania’s GDP and employs around one-third of the population, but receives less than 2% of total bank credit, with recent lending trends described as unencouraging. He cited longstanding barriers including property ownership issues, informality, elevated business risk and low productivity linked to the absence of economies of scale, and pointed to the Government of Albania’s sovereign guarantee scheme for agricultural loans as a risk-mitigating tool that can reduce collateral constraints. The refocused MSME programme is positioned as a low-cost funding source for banks to support development projects in agriculture, including agrotourism and the agro-food industry, while stressing that any push to expand lending should not jeopardise banks’ soundness or financial stability.