Strategies of the Development of Entrepreneurship and SME

3.1.4.3. Mutual and loan guarantee fundsThere have not been so far any mutual or loan guarantee fund operational. Someof the projects with a component of loan guarantee are reported as follows:• Land O’Lakes (LOL) is a USAID small loan guarantee fund for coveringlending risk to small dairy farmers or processors;• IFC Loan guarantee risk sharing agreement with ABA - for a total ofUS$ 2.5 million. To date no projects have been approved for coverage bythis facility.• DEG SME Loan guarantee risk-sharing agreement with BIA – Bothparties have now terminated it, since it never became fully operational asintended. The principal reason being a lack of bankable projects;• Albanian Small Business Credit and Assistance Program (ASBC) is anew USAID funded program providing credit and TA to existing SMEs inproduction sectors. It also has a small SME loan guarantee facility, but thisis not operational as yet. There is a project, as mentioned, of 2.5 millions ofUSD to support the establishment of a loan guarantee fund. However, up tonow this is still an idea and no concrete proposal is so far discussed by theauthorities.The Enterprise Policy Development in the Western Balkans, Report on theImplementation of the European Charter for Small Enterprises in the Western Balkans 2007,concerning financial matters, focuses on the credit environment and the range of financialproducts available to SMEs. Restructuring of the banking industry has started to have a positiveimpact, in terms of diversification of banking services and improvement of lending conditions.Sectors such as leasing are growing, with relevant legislation in place and progress being madein implementation. Collateral requirements remain high. Credit Guarantee Schemes,particularly those based on a mutual system, still play a marginal role. The legal andoperational credit environment needs to be further developed.3.1.5. TASKS FOR IMPROVEMENT AND FURTHER DEVELOPMENT OF SME SECTORAlbania has made relatively good progress in building institutions responsible forelaborating and delivering SME policy and completing the relevant legal and institutionalframework. However, policy is still at an early stage of development in the broad regulatoryarea, particularly with respect to company registration, where Albania actually lags behind therest of the region. Albania is committed to reforming the company registration process, butconcrete results still need to be demonstrated. In the next stage of reform a focus on furtherprogress with respect to one-stop shops, licenses and permits, and the establishment of an26