Barriers for Access to Finance


Donor: International Labour Organization
Time period: 11/02/2020 – 31/05/2020
Total Amount: 6,440€‎

The objective of the Project is to identify the main reasons why access to finance remains a key challenge for companies in North Macedonia, especially for micro, small and medium enterprises (MSMEs). In addition, the Project will explore policy options and potential actions to increase and improve the access to finance. The Project is supported by the ILO, as part of their project on strengthening social dialogue in North Macedonia (funded by the European Union).

The deliverable of the Project is a policy paper for the Economic and Social Council with suggested actions to be discussed in the Council and to be presented to the Government. Specifically, the deliverables of the Project include an analytical report, a policy paper on enhanced access to finance, and a roadmap with concrete recommendations, with the following three elements:

  • Why access to finance remains a key challenge for enterprise development in North Macedonia (challenges of the legal and regulatory framework, the financial infrastructure, e.g., credit reporting systems or collateral regimes, and the financial service offer)
  • Exploring what to do with regard to primary providers of financial services, enabling environment for access to finance, public support schemes (e.g., credit guarantees, state banks), and specific priorities (e.g., innovation, environmental protection, startups)
  • Increasing access to finance: Suggested actions for North Macedonia.

The project combines two methodologies: i) desk research of the existing literature and available primary and secondary data related to the financial system and situation with access to finance; and ii) field research including interviews, survey and focus group discussions with both the supply and demand side of the corporate financing.

During the lifetime of the Project, the new situation with the Pandemic changed the course of action. Hence, the fieldwork was amended with the consent of both parties (the donor and the implementer) and was swapped with a survey of the impact of the Covid-19 on the companies, along with recommendations for the policymakers on policies that may ease the economic and financial burden for companies.