A few weeks ago, the government announced its intention to establish the Albanian Development Bank, through which small and medium-sized enterprises (SMEs) are supported, including startups as well as development projects related to the improvement and modernization of physical and digital infrastructure, with a special focus on green investments.

Economics expert, Klodian Muço said for ATA that such banks have also been established in other countries and have proven successful.

Muço stated that they should be oriented towards financing new enterprises and priority projects for the country's economic development, as well as those that create more employment.

Muço stated that these types of banks offer opportunities for new businesses which, due to their lack of history, do not offer guarantees for their solvency before second-tier banks, a key criterion for lending.

He also said that banks of this nature do not distort the market. The expert emphasizes the importance of creating this bank to increase the production of Albanian products. “It is a good initiative that can stimulate competitiveness by promoting or stimulating “Made in Albania” products,” said Muço. He emphasized that in the success of this bank, the selection of managers and personnel with experience in this field plays an essential role.

The second aspect, said Muço, is the part of evaluating and identifying new startups and finding mechanisms to stimulate new businesses to tap into a financial institution like the Development Bank.

He noted that the third aspect is the form of financing of this institution, where he listed three models: The model of Banco-Posta like Italy, that of the Development Bank of Brazil, or the development financing model of North Macedonia.

Depending on the model that will be chosen for financing, there will also be a challenge of how to find access to money to enable the development of normal activities of this bank, noted Muço.

For the establishment of the Albanian Development Bank, the initial capital will be Lek 10 billion, a contribution from the Albanian state, which will be repaid within 4 years. The state will also be a shareholder of 51% of its shares.

The Albanian Development Bank will raise funds through various mechanisms, including accepting repayable funds from the public and other financial instruments, and will also be able to establish branches and subsidiaries within and outside the country.