From 24 hours to one minute: How state guarantees are automating Moldovan manufacturing
Moldovan entrepreneurs are successfully scaling their operations without traditional collateral, thanks to a state-backed credit guarantee mechanism. The Entrepreneurship Development Organization (ODA), in partnership with the World Bank, is now acting as a guarantor for businesses lacking physical assets for bank security.
Ina Butnari, manager of a prominent furniture manufacturing firm, secured two bank loans totaling €700,000 (approx. 13.8 million MDL) under this scheme. The decision to expand was driven by the government's commitment to de-risk private investment in the industrial sector.
Technological leap through automation
The first injection of €300,000 enabled the company to integrate robotic painting systems and professional drying facilities. This investment fundamentally altered their production timeline, reducing certain processes from 24 hours of manual labor to just 60 seconds of automated precision.
According to Butnari, the transition was essential for maintaining a competitive edge. "The production volume increased dramatically," she told Moldova 1. "Before the robot, the drying process took a full day. Now, the goods are ready in a minute."
Scaling industrial capacity
In 2023, the firm accessed an additional €400,000 to acquire a new production hall. While acknowledging the rigorous financial analysis required by banks, Butnari emphasized that a transparent accounting system and a structured growth plan made the bureaucratic process manageable.
Since its launch in 2022, the portfolio guarantee mechanism has supported over 30 entrepreneurs, facilitating loans totaling €1.5 million (30 million MDL). Currently, three major partner banks are participating in the program.
Simplified access to credit
Vadim Indoitu, Head of the Credit Guarantee Fund at ODA, noted that the mechanism simplifies the borrower's journey. Entrepreneurs only need to request the "portfolio guarantee" during their standard application process.
"Lenders evaluate the credit based on internal standards, requiring no additional documentation beyond what is typically requested for a loan," Indoitu explained. The program continues to bridge the financing gap for high-potential SMEs in Moldova.
Translation by Iurie Tataru
