Business loans in Sverdlovsk region experiencing a 25% decrease
In the heart of Russia, the Sverdlovsk region, renowned for its robust business landscape, has been witnessing an exceptional growth in the count of small and medium-sized enterprises (SMEs) every year. As of Q2 2025, the region boasts an impressive figure of 216,210 SMEs, with self-employed individuals touching the impressive mark of 389,360. This means that a third of the economically active population in the region is deeply involved in business, a fact proudly shared at a roundtable organized by the Sverdlovsk Regional Fund for Supporting Entrepreneurship for banks and credit organizations.
Though experts confirm that lendingly and borrowing habits have seen a significant change in the first quarter of 2025, a quarter of the borrowing activity compared to the same period last year can be attributed to the high key interest rate.
In the year 2024, the demand for credit resources remained moderate. Many companies refrained from borrowed funds due to the rise in key interest rate and the overall economic situation. Consequently, the issuance of loans reduced by approximately 25% in the initial quarter of 2025 when compared to the previous year's corresponding quarter. However, certain sectors that face challenges without sufficient credit resources continue to witness demand for loans. Trade, for instance, still manages to stay afloat, thanks to active lending by UBRiR, as declared by Sergei Chuntinov, the head of the small business department at UBRiR's corporate business department.
Modern borrowers, according to Valentina Zhiltsova, the head of VTB in the Sverdlovsk region, are primarily engaged in trade, services, and catering. They have managed to absorb the cost of the loan into the cost of the product. Interestingly, SMEs are also actively employing guarantees as an alternative to lending, reducing the interest rate burden.
A slight deviation from the general trend can be observed in the lending to the agricultural sector in the region. Agricultural businesses are still eligible for loans at a reasonable rate of 8.3% per annum due to state support, as reported by Tatiana Shilova, the director of the Sverdlovsk branch of Rosselkhozbank. The region has a law that allows agricultural producers to receive subsidies from both the federal and regional budgets. In 2024, around 5 billion rubles in subsidized funds were allocated, with 3.8 billion coming from the local budget.
Valeriy Pilichev, director of SOFPP, affirms that loans continue to remain a much sought-after resource among small businesses despite the high interest rate. Despite the high interest rate, SOFPP has been instrumental in issuing around 2,000 guarantees with partner banks, with a total amount of approximately 15 billion rubles in 2024. This has enabled entrepreneurs to secure loans worth around 59 billion rubles, making SOFPP the leading organization in the country in this aspect.
Interesting Statistics: According to DK.RU, business took out 52.2% fewer loans in January 2025 compared to December of the previous year. The trend of using guarantees instead of loans by MSMEs is a fascinating subject, requiring an understanding of the economic, regulatory, and market conditions that influence this choice. The key factors contributing to this preference include uncertainty and risk, interest rates and fees, government support programs, strict regulations, collateral requirements, market competition, creditworthiness, financial flexibility, bureaucratic process, lack of access to traditional financing, awareness and education, and availability of guarantees. The choice between guarantees and loans for MSMEs in the Sverdlovsk region of Russia in 2025 is influenced by a combination of these factors.
I'm not sure if the industry of lending practices has seen a significant shift towards the use of guarantees by small and medium-sized enterprises (SMEs) in the finance sector, but the trend of using guarantees instead of loans by MSMEs in the Sverdlovsk region is worth investigating. The key factors that may influence this choice include interest rates and fees, government support programs, strict regulations, collateral requirements, market competition, creditworthiness, financial flexibility, bureaucratic process, lack of access to traditional financing, awareness and education, and availability of guarantees.
