DIASPORA INVESTMENT WINDOW

The Kosovo Credit Guarantee Fund (KCGF) is in the process of preparing agreements with its Registered Financial Institutions (RFIs) and will publish the list of partner banks for the Diaspora Investment Window once the agreements are signed.

The Diaspora Window initiative aims to provide a comprehensive approach to facilitate investments from the Kosovar diaspora individuals who work and reside abroad.

WHAT DO WE CONSIDER DIASPORA INVESTMENT AND WHAT ARE THE LEGAL REQUIREMENTS?

Participants should express a clear intention to invest in Kosovo: 

• By initiating new business venture
• By supporting existing business within the country established by investor from diaspora.

Ownership structure of the newly established business by investor from diaspora should be:

• Fully owned by the diaspora investor.
• In partnership with residents of Kosovo (e.g., business partners, family relatives, friends who live and work in Kosovo).
• Established by the diaspora investor with a foreign co-investor (non-resident of Kosovo).

In all three cases, the diaspora investor must own at least 30% of the company. The investor must support the idea of establishing a new enterprise with a business plan and businesses with experience longer than 36 months are not qualified for this window..

Compliance with Legal and Regulatory Requirements:

Applicants must comply with all relevant laws, regulations, and guidelines governing investment and business activities in Kosovo. Furthermore, the applicant should undergo an anti-money laundering (AML) due diligence process and must provide evidence that they are not currently the subject of any judicial proceedings in their country of residence, or subject of any international sanction list.

WHICH BUSINESSES QUALIFY?

Small, micro and medium enterprises are required to be:

• Owned and established by the investor with diaspora status
• Registered in the Kosovo Business Registration Agency (KBRA). For more detailed information click the link:  https://arbk.rks-gov.net/
• Established by diaspora with a working experience not longer than 36 months.
• Inclusive for different sectors except those prohibited by the KCGF environmental and social management policy.
• Investor with a clear investment business plan.
• Investor must have a good credit rating or scoring from the country where they live and work, and Kosovo.
• Business with less than 250 employees.

Additional information’s on Kosovar origin of the owner of the business:

• Everyone who originally was born and lived in Kosovo but emigrated and lived for more than three years out of the country.
• The offspring (new generations) of Kosovan parents, extending to the second generation, originating from Kosovo.
• Investor must document their stay outside Kosovo ( official address).

WHICH LOANS CAN BENEFIT FROM DIASPORA INVESTMENT WINDOW?

Qualified Loans fulfilling the following criteria will be eligible for Diaspora Investment Window benefits:

• The minimum loan amount is EUR 3,000.
• The maximum loan amount is EUR 3,000,000.
• The minimum guarantee amount is EUR 1,500.
• The maximum guarantee amount is EUR 2,000,000.
• The minimum repayment period of the guaranteed loan is 3 months.
• The maximum repayment period of the guaranteed loan is up to 84 months.
• The purpose of the loan can be for different investments (fix assets; equipment; working capital)

TYPE OF LOAN

Loan;  Credit Line; Overdraft.

WHAT ARE THE GUARANTEE FEATURES?

• Guarantees will be provided for the amount up to 80% of the loan principal but not more than EUR 2,000,000.  Percentage of guarantee coverage is flexible and increases as the equity participation from the investor increases. *
• The maximum loss cap will be 15% in portfolio level.
• The investor’s participation in the total investment (equity participation) is mandatory and must be at least 20% or higher.

 * Proposal of the guarantee coverage versus the equity participation in relation to bank loan

WHAT IS THE APPLICATION AND DECISION-MAKING PROCESS?

• The potential borrower does not apply for a guarantee but applies for a loan in one of the KCGF Registered Financial Institutions (RFI).
• The Registered Financial Institution (RFI) after performing the usual credit analysis by applying the risk assessment standards and if the company meets the KCGF criteria, then the relevant RFI places the loan under the KCGF credit guarantee.
• After placing the loan by the relevant RFI in the Information Management System of the KCGF, then KCGF accepts the loan under its credit guarantee.